How to fill in schedule D38
Updated 12 August 2024
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This publication is available at https://www.gov.uk/government/publications/inheritance-tax-business-relief-business-or-partnership-interests-d38/how-to-fill-in-schedule-d38
When you should complete this form
You must fill in this form if you’re deducting Business Relief and the transferor or settlor owned any of the following:
- shares in a company
- a business or part of a business
- assets used in a business
You may need to fill in a separate form for each holding of shares, business or asset.
What qualifies for Business Relief
You cannot claim Business Relief on assets that also qualify for Agricultural Relief.
You should treat Business Relief on assets held in a trust the same as assets in a person’s estate.
The transferor or settlor must have owned the assets for a minimum period, usually 2 years. You can claim relief for transfers that involve the following assets and shares.
A business or interest in a business
You can claim relief on a business or an interest in a business.
Stocks and shares
You can claim relief on certain types of shares in a company.
There are different rules for listed and unlisted companies.
Listed companies
This means a company is listed on a recognised stock exchange.
For transfers after 9 March 1992, it also includes shares trades on the:
- American NASDAQ (National Association of Securities Dealers Automatic Quotation System)
- European EASDAQ (European Association of Securities Dealers Automatic Quotation System)
You can claim relief on listed companies if the transferor or settlor controlled more than 50% of the voting powers at the time of the event. This is known as ‘control holding’.
Unlisted companies
This means a company is not listed on a recognised stock exchange.
Some companies are listed in the Stock Exchange Daily Official List but are unlisted for Business Relief. This includes:
- shares listed on the Alternative Investment Market (AIM)
- shares listed on the Unlisted Securities Market (USM)
You can claim relief on unlisted companies if the transferor or settlor:
- owned any shares in an unlisted company
- controlled more than 50% of the voting powers at the time of the event — known as ‘control holding’
- controlled more than 25% of the voting powers at the time of the event — known as ‘substantial holding’
Land, building or plant and machinery used in a business
You can claim relief on these assets if they’re used either:
- in a business where the transferor or settlor was a partner at the date of the event
- by a company which was controlled by the transferor or settlor
If they’re held in a trust they will only qualify for Business Relief if both of the following apply:
- the transferor or settlor had the right to benefit from the trust
- the asset was used in a business by the previous owner as part of their business
Check how much relief you can claim
The following table shows how much Business Relief you can claim for transfers from 9 March 1992.
| Type of asset or share | Transfers after 6 April 1996 | Transfers from 10 March 1992 to 5 April 1996 | 17 March 1987 to 9 March 1992 |
|---|---|---|---|
| A business or an interest in a business | 100% | 100% | 50% |
| Control or substantial holding of shares in an unlisted company | 100% | 100% | 50% |
| Other shares in an unlisted company | 100% | 50% | 30% |
| Control holding of shares in a listed company | 100% | 50% | 30% |
| Land, building or plant and machinery used in a business or held in a trust | 50% | 50% | 30% |
Working out the amount of relief
You can work out the relief by deducting the percentage from the total value of the asset.
If the asset qualifies for 100% relief, you should include the total value of the asset in the corresponding box in the assets section on the IHT100 series form.
Find more information about Business Relief
Check which assets do not qualify for Business Relief.
Read technical guidance about Business Relief in the Inheritance Tax Manual.
What happens next
You should use the figures in this schedule to help you fill in the IHT100 series form.
You must send this form alongside the completed IHT100 series form. Make sure you include copies of any documents we’ve asked for.
Get help
You should contact the Inheritance Tax helpline if you need help completing this form.