McCUTCHEON ON INHERITANCE TAX
By Barry McCutcheon and Withers LLP
Reviewed by Mark McLaughlin CTA (Fellow) ATT TEP,
Editor of TaxationWeb
The publishers, Sweet & Maxwell, describe McCutcheon on Inheritance Tax as 'the leading authority on inheritance tax'.
My expectations of this book were therefore very high. I am pleased to
report that I was not disappointed!
My preconceptions about McCutcheon on Inheritance Tax included
that the book would be a highly technical, authoritative work, which would
be best suited to inheritance tax (IHT) specialists. I believe that those
preconceptions were partly correct, but only in the sense that the book
has been written with great skill and expertise, and to a highly advanced
technical level. However, the authors state that the underlying purpose
of the book is to enable its readers to genuinely understand how IHT works.
An overview of IHT generally is therefore provided in the opening Chapter,
and there is a further overview Chapter dealing with settled property
with no qualifying interest in possession (more commonly known as 'discretionary
trusts'). These Chapters provide a useful grounding to IHT and discretionary
trusts, and set the scene for the Chapters that follow.
This is the fourth edition of McCutcheon on Inheritance Tax.
Surprisingly, the third edition was published around 18 years ago, back
in 1988. Having reviewed this book, I certainly hope that I do not have
to wait another 18 years for the fifth edition! Inheritance tax has not
been the fastest changing of taxes in recent years in terms of legislative
reforms or changes in practice. The publishers state that McCutcheon on Inheritance Tax may be supplemented in the future 'to
keep your main work up-to-date…'. However, a looseleaf format
with annual updates may be worth considering.
Contents
This impressive looking hardback publication is a massive 1,079 pages
long. McCutcheon on Inheritance Tax is divided into four
parts. Firstly, the main charging provisions section covers the structure
of IHT and how it applies during lifetime and on death. It also contains
a Chapter on Reservation of Benefit, which includes the 'Pre Owned
Assets' income tax regime that was introduced as a result of IHT
avoidance arrangements. Secondly, the special charging provisions section
deals with discretionary trusts, and the IHT charges related to them.
Thirdly, the special subjects section deals with specific aspects of IHT,
such as business and agricultural property reliefs, other forms of IHT
relief, an interesting Chapter on settled property definitions, and a
useful Chapter on IHT administration. Fourthly, the international dimension
section includes Chapters on the territorial scope of IHT covering domicile,
together with aspects of international estate planning. The book's
index is fairly comprehensive for ease of reference.
The authors have a real talent for explaining relatively complex provisions
succinctly, and with great clarity. Paragraphs are short but concise,
and therefore easier to comprehend and digest. Numerical worked examples
are also a fairly prominent feature of the book, illustrating some of
the computational aspects of IHT and providing a deeper, practical understanding
of the law.
The book refers to the Inland Revenue Advanced Instruction Manual. This
manual was withdrawn by the Inland Revenue (now HM Revenue & Customs)
and replaced by the Inheritance Tax Manual. In fact, the former manual
was apparently withdrawn when the authors were in the process of writing
this edition of the book. The fifth edition will no doubt be updated to
include references to the new Manual.
Cost
McCutcheon on Inheritance Tax costs £195. This is
a not inconsiderable amount of money to pay for a single book, and probably
above average for a publication on tax. However, for an authoritative
work on IHT of such length and depth, it has to represent very good value
for money.
The Verdict
McCutcheon on Inheritance Tax is comprehensive in its coverage
of IHT and yet concise in its commentary. It is a technically advanced
authority, and yet it is very clear in its explanations of complicated
legislation and relatively easy to read and digest.
From a personal standpoint, I hope that the authors and publishers will
update the book at regular intervals (perhaps in looseleaf format?), rather
than periodically. Whilst IHT has not been the fastest moving of taxes
in recent years in terms of legislative changes, it is very important
to stay abreast of changes in practice and, perhaps more importantly,
the views of HM Revenue & Customs Capital Taxes on their interpretation
of the legislation. The expert and insightful views of the authors in
these areas will be invaluable to professionals engaged in giving advice
on IHT at virtually every level.
McCutcheon on Inheritance Tax would surely grace the tax
library of any practitioner or firm that regularly advises clients on
IHT issues. I have no doubt that it would be a regular point of reference.
Those who do not already possess a copy of this book are strongly recommended
to obtain one, to see for themselves.
As mentioned in the introduction, my expectations of McCutcheon on Inheritance Tax prior to reviewing it were high. I have to say
that those expectations were met and exceeded. I was highly impressed
with this publication.
Mark McLaughlin
TaxationWeb
October 2005
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