Can I use Business Relief on my actively managed HMO properties to reduce my Inheritance Tax liability, and what evidence do I need to prove it's a trading business rather than an investment?
Quick Answer
Inheritance Tax Business Relief (BR) is generally not available for HMOs in the UK, as HMRC usually classifies property letting as an investment activity. Achieving BR requires providing substantial services beyond routine landlord duties, transforming it into a trading business.
About This Topic
Understand IHT Business Relief for UK HMOs. HMRC views property as investment. Learn what services prove a trading business to avoid 40% tax.
This question is part of our Tax & Accounting category, providing expert guidance on UK property investment.
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