Inheritance Tax
Lifetime transfers, death estate, exemptions, reliefs, nil-rate bands, valuation, tax, payment and planning.
How to study ACCA Applied Skills
Build on Applied Knowledge, use the correct UK law and tax versions, practise workplace-style digital responses and keep each independent 50% pass decision visible.
Core concepts
Concept 1
Inheritance tax applies to relevant lifetime transfers and the death estate after exemptions, reliefs and available bands.
Exam cue: Build a chronological transfer history before calculating the current transfer.
Concept 2
Transfer classification, timing, donor survival and earlier transfers affect both rate and available nil-rate band.
Exam cue: Classify each transfer and apply exemptions or reliefs before bands and rates.
Concept 3
Liability, due date and grossing depend on the transfer and who bears the tax.
Exam cue: Separate lifetime tax, additional death tax and tax on the death estate.
Risk pitfalls and guardrails
Calculating transfers independently without cumulation.
Guardrail: Do not reuse a legal rule, tax amount, reporting format, audit phrase or finance formula without checking scope, date, units and evidence.
Applying a death-estate rule to a lifetime transfer.
Guardrail: Do not reuse a legal rule, tax amount, reporting format, audit phrase or finance formula without checking scope, date, units and evidence.
Using an allowance or rate without confirming the examined Finance Act.
Guardrail: Do not reuse a legal rule, tax amount, reporting format, audit phrase or finance formula without checking scope, date, units and evidence.
Memory anchors
PET
A potentially exempt transfer becomes exempt if the donor survives the required period, subject to the current rules.
CLT
A chargeable lifetime transfer can create an immediate inheritance-tax charge.
Nil-rate Band
The nil-rate band covers cumulative chargeable value before inheritance tax is charged at positive rates.
Taper Relief
Taper relief can reduce tax on qualifying lifetime transfers; it does not reduce the transferred value.
Death Estate
The death estate values property transferred on death less allowable deductions and qualifying reliefs.
Checkpoint rule
Do the check-up only after you can summarize each concept in one sentence and identify one dangerous pitfall from memory.
Knowledge Check (after reading)
Short check-up to confirm understanding of this module.
Check-up Questions
What is a potentially exempt transfer?
Why must earlier lifetime transfers be listed chronologically?
Answer all questions to submit.
Next step personalized recommendations
Continue learning
Move forward only after this module is stable.
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