Record Tax Paid by Gifts in Lieu
According to HMRC a record £64.5m worth of assets came into national ownership in 2020 through the “acceptance in lieu” and “cultural gift” schemes. These schemes allow taxpayers to settle IHT, CGT or Corporation Tax liabilities by transferring objects of “pre-eminent” importance to the nation.
The IHT scheme is quite generous, allowing the value of the object, less tax that would have been paid on it’s sale, plus a “douceur” of 25% of the notional IHT relating to it to be credited to an estate. Gifts in 2020 included a Manet painting and Liotard’s painting The Lavergne Family Breakfast (detail above)
The Cultural Gifts scheme allows up to 30% of the value of a donated object to be credited against CGT liabilities when items are donated to a designated museum or gallery.