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Liability for any IHT due in respect of a transfer of value made by a close company falls, primarily, on that company¹. Payment of the tax by the company, being in satisfaction of its statutory obligations, clearly does not constitute a transfer of value even though the participators, because of differing marginal tax rates, may have 'contributed' to the overall liability in proportions different to their relative interests in the company. For liability for IHT see Division I10.1.

If, however, the company fails to pay the whole, or any part, of that tax by the due date (see I10.114), liability for that amount falls on those individuals to whom any amount has been apportioned under IHTA 1984, s 94(1) and upon any individual whose estate was increased by the relevant transfer of value².

Essentially, the liability of the participators and beneficiaries