IHT413 is the Inheritance Tax schedule for a business the person who died owned, their share of a partnership, or assets they owned that were used by their company or partnership. It's also where you claim Business Relief on those interests. Business interests go in box 69 of form IHT400 and the relief in box 93, while shares in a company go on IHT412 instead.
This guide follows Schedule IHT413 (version HMRC 04/26), GOV.UK's Business Relief guidance and the IHT400 Notes, as of October 2026.
IHT413 or IHT412?
Use IHT413 for an unincorporated business (a sole trader), a partnership interest, and assets the deceased personally owned that were used by a business they controlled or were a partner in. If the business interest was a holding of company shares, the form says to put it on IHT412, unlisted shares and control holdings, not here.
The four parts of the form
| Boxes | What they cover |
|---|---|
| 1 to 6 | Ownership for 2 years and any binding contract for sale |
| 7 to 17 | The business or partnership: value, activity, how it was valued, partnership details and the relief claimed |
| 18 to 21 | Assets owned by the deceased and used by their company or partnership |
| 22 to 25 | Relief on lifetime gifts, plus space for extra information |
The 2-year test
Box 1 asks whether the deceased owned the business interest throughout the 2 years up to the date of death. If not, box 2 warns that Business Relief isn't normally due, and asks you to say why you think it still is. GOV.UK confirms you can only get relief if the deceased owned the business or asset for at least 2 years before they died.
Binding contracts for sale
Relief can't be deducted on a business, interest or asset that was subject to a binding contract for sale at the date of death. The exception in box 6 is a sale to a company that will carry on the business, made wholly or mainly for shares or securities in that company. Partnership agreements sometimes contain clauses that force a sale on death, so read the agreement before you claim.
Valuing the business
Box 7 asks for the value of the business or partnership interest at the date of death, which goes in box 69 of IHT400. Box 9 asks how you calculated it, with the assets and liabilities included, a copy of any professional valuation, and copies of the latest 3 years' accounts. For a partnership, boxes 11 to 15 ask for the start date, the partnership's Unique Taxpayer Reference, who provided the capital and how much, and how profits are shared, plus a copy of the partnership agreement or a description of the informal terms.
Relief rates after 6 April 2026
For deaths on and after 6 April 2026, as of October 2026:
- Relief at 100% on the combined value of qualifying agricultural and business property is limited to £2.5 million, and any value above that qualifies at 50%.
- The allowance must be apportioned across all qualifying property in the estate, and it includes qualifying gifts made on or after 30 October 2024 within 7 years of the death.
- A late spouse's or civil partner's unused allowance can be transferred if the claim is made in time.
- Box 17 splits the relief you're deducting into a 100% figure and a 50% figure, and both go in box 93 of IHT400.
Assets used by the business: always 50%
Boxes 18 to 21 deal with land, buildings or machinery the deceased owned personally but let their partnership or controlled company use. The form says that for transfers after 9 March 1992 this always qualifies at a rate of 50%, if eligible. Families often assume the farm shed or the workshop the company used gets the same relief as the business. It doesn't: it's half.
Executors who would rather not use their own funds can read the guide to settling the bill from the deceased's accounts.
What doesn't qualify
- A business that mainly deals in securities, stocks, shares, land or buildings, or makes or holds investments.
- A not-for-profit organisation.
- A business being wound up, unless that's part of a process that lets it carry on.
- An asset that wasn't used mainly for the business in the 2 years before death, or isn't needed for future use in it.
- An asset that also qualifies for Agricultural Relief.
GOV.UK's example is a building where one room is used as a shop and the other rooms are a home: the shop can qualify, the other rooms can't.
Property in an estate has its own form, explained in the guide to reporting houses, land and buildings.
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Gifts of business property
Boxes 22 to 24 only apply if you're deducting relief on a lifetime gift. They ask whether the person who received the gift kept it throughout the relevant period, whether it would still have qualified if they'd transferred it at the date of death, and whether it was under a binding contract for sale. Lifetime gifts themselves are listed on IHT403, gifts and other transfers of value.
Step by step
- Decide which form each interest belongs on: IHT413 for the business, partnership share and assets used by it, IHT412 for company shares.
- Check the 2-year ownership test and any binding contract for sale.
- Value the interest at the date of death, with the latest 3 years' accounts and any valuation.
- Work out relief at 100% and 50% using the shared allowance, and enter both in box 17.
- List assets used by the business in box 18 and claim 50% relief in box 21 where eligible.
The verdict
IHT413 rewards preparation. Pull together 3 years of accounts, the partnership agreement and a supported valuation before you start, check the 2-year and binding-contract tests, and split the relief between 100% and 50% with the new allowance in mind. Then carry the figures into form IHT400. HMRC's Inheritance Tax helpline is 0300 123 1072, or +44 300 123 1072 if you're calling from outside the UK.
Frequently asked questions
What is IHT413 used for?
It reports the deceased's business, partnership interest or assets used in a business, and claims Business Relief on them.
Do company shares go on IHT413?
No. Control holdings and other company shares go on Schedule IHT412, unlisted stocks and shares and control holdings.
How long must a business be owned for Business Relief?
The deceased must normally have owned the business or asset for at least 2 years before they died.
What relief do assets used by the business get?
Assets the deceased owned and let their partnership or controlled company use qualify at 50%, if eligible.
Where do IHT413 figures go on IHT400?
The value of the business interest or assets goes in box 69, and the Business Relief in box 93.
What documents should go with IHT413?
Copies of the latest 3 years' accounts, any professional valuation and, for a partnership, the partnership agreement.
