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Book Review: McCutcheon on Inheritance Tax (6th Ed.)
01/01/2014, by Mark McLaughlin CTA (Fellow) ATT TEP, Tax Articles - Inheritance Tax, IHT, Trusts & Estates, Capital Taxes
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Mark McLaughlin reviews the 6th edition of McCutcheon on Inheritance Tax

McCutcheon on Inheritance Tax  (Sixth Edition)

By Withers LLP, Aparna Nathan and Marika Lemos

‘McCutcheon on Inheritance Tax’ is a long-established authority on inheritance tax (IHT). The publication is now in its sixth edition. The fifth edition was published three years before the current one. The time gap between editions is perhaps a reflection of the fact that IHT is not the fastest moving of UK taxes in terms of legislative change. Having said that, the ‘law stated at’ date for the sixth edition is 5 April 2012; there have been significant IHT changes since that date, such as in respect of the spouse exemption for non-UK domiciled spouses, and restrictions in deductions for liabilities, both of which were included in Finance Act 2013. In addition, new IHT case law and changes in HM Revenue & Customs’ practice and approach are not uncommon. These factors possibly make a good case for this book to be published and acquired on a regular basis.

The introductory pages state that “the underlying purpose of the book has always been to foster in readers a genuine understanding of how inheritance tax works and that remains the underlying goal of this edition.” McCutcheon on Inheritance Tax has been written with great skill and expertise to a high technical level. However, the helpful and practical structure of this book means that IHT practitioners of all technical levels can benefit from its contents.

The book is divided into four parts. The first part covers the main IHT charging provisions, with chapters including transfers of value, exempt transfers, the nil rate band, potentially exempt transfers and chargeable lifetime transfers. Part two covers the special IHT charging provisions relating to settled property. Parts one and two both include an ‘overview’ chapter, which provides a very useful introduction to the structure of the IHT regime dealt with in those parts and the chapters which follow. Part three deals with ‘special subjects’ such as valuation, business and agricultural property relief, partnerships and IHT administration. Part four is ‘the international dimension’, with chapters on the territorial scope of IHT (domicile, excluded property and situs), double taxation relief and aspects of international estate planning. The book’s index is fairly comprehensive, for ease of reference.

As someone who has used McCutcheon on Inheritance Tax in ‘real life’ situations, I have personally found the chapters dealing with reservation of benefit and business property relief to be particularly helpful; but other practitioners who use this book on a day-to-day basis will no doubt have their own particular favourites. Examples and case studies are a useful feature of any technical book, including this one. A few more examples and case studies would probably help even further to illuminate some of the more complex IHT issues.

At 1,324 pages, McCutcheon on Inheritance Tax is a weighty tome. The page count says a lot about the depth of commentary in the book. Whilst the commentary is written to a high technical level, it is nevertheless very readable and easy to follow. The authors have a real talent for explaining relatively complex provisions succinctly, and with great clarity. The authors are to be congratulated for this very difficult skill. Paragraphs are short but concise, and therefore easier to comprehend and digest.

On a practical level, one disadvantage of such a thick, heavy book is that it is not very portable; an online version would be extremely useful, or at least a CD to accompany the book. ‘McCutcheon on Inheritance Tax’ costs £275. This is a not inconsiderable amount of money to pay for a single book, and probably above average for a tax publication. But this is not an average tax publication.  For an authoritative work on IHT of such length and depth, it has to represent very good value for money, particularly when compared to other publications of a similar standard.

In conclusion, ‘McCutcheon on Inheritance Tax’ is comprehensive in its coverage of IHT, and yet is concise in its commentary. It is a technically advanced authority, and yet is very clear in its explanations of complicated legislation, and relatively easy to read and digest. It would surely be an invaluable part of the tax library of any practitioner or firm that regularly advises clients on IHT issues, and a constant point of reference. Those who do not already possess a copy of this book are strongly recommended to obtain one.

Mark McLaughlin

About The Author

Mark McLaughlin is TaxationWeb's Co-Founder, Director and Technical Editor. He is a Fellow of the Chartered Institute of Taxation and a member of the Association of Taxation Technicians and the Society of Trust and Estate Practitioners. He lectures on tax subjects, is co-author of Tottel's IHT Annual and Ray & McLaughlin's IHT Planning, and Editor of Tottel's Tax Planning and Annual series. Mark's work has also been published in Taxation, Tax Adviser, Tolley's Practical Tax, Tax Journal and Simon's Weekly Tax Intelligence.

Since January 1998, Mark has been a consultant in his own tax practice, Mark McLaughlin Associates, which provides tax consultancy and support services to professional firms. He publishes a regular 'Tax Update' e-Newsletter for clients and other professional firms. To receive future copies, contact Mark via his website.

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