Generally, the whole of the value transferred by a transfer of value made by a close company must be apportioned to its participators (other than those who participate simply as loan creditors1). There are, however, three situations where no apportionment is made.
Firstly, under IHTA 1984, s 94(2)(a) no apportionment is made to the extent that the value transferred is attributable to a payment, or to a transfer of assets, to any person, which is taken into account in computing that person's profits or gains or losses for income tax or corporation tax purposes2. This is to prevent a liability to IHT from arising in respect of a payment or transfer already subject to income tax or corporation tax (but not to CGT or,
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