A collection can be free of Capital Gains Tax and still contribute to a substantial Inheritance Tax bill.

In the UK, qualifying private cars are exempt from Capital Gains Tax when sold, even if they have increased in value. That exemption does not extend to Inheritance Tax. When the owner dies, the cars' market value forms part of their estate, with any tax due determined by the applicable allowances, exemptions and circumstances.

For a significant collection, the financial consequences can be considerable. The estate may hold substantial value in cars without having the cash available to meet its obligations. The family may want to keep the collection, while the executors need to establish how the tax will be paid.

IN helps owners prepare for that situation while they can still make decisions, explain their intentions and involve their advisers.

The value is in the cars. The liability must be funded.

Inheritance Tax is normally payable by the end of the sixth month after death, and a payment is usually required before probate is granted. The tax is normally paid from the estate, but finding the money can create difficult decisions for those administering it.

Without preparation, cars intended to remain in the family may need to be sold to help fund the estate's liabilities. Missing records, uncertain values and an unfamiliar market can make those decisions harder and place pressure on the timing of a sale.

Selling a qualifying car without CGT does not, by itself, reduce the estate for Inheritance Tax purposes. If the proceeds remain with the owner, the estate holds the cash instead of the car.

Preparing the collection while you can decide.

IN establishes what the collection contains, brings each car's record together and maintains supported valuations for planning. We record what the owner would like to happen to each car, whether it should remain in the family, pass to a named person or be considered for sale.

Those intentions can then be considered alongside the wider estate, the funds likely to be available and the advice of the owner's legal and tax advisers. A wish to preserve a collection needs arrangements that make preserving it practical.

The result is a collection that is understood, with documented intentions and the evidence needed to support the decisions ahead.

Working with the owner's advisers.

IN works alongside the owner's lawyers and tax advisers. It does not give legal or tax advice or determine the estate's tax liability.

We provide an accurate inventory, supporting documentation and valuations appropriate to the work being undertaken. Following a death, valuations must reflect the position at the date of death rather than simply repeat an earlier insurance or planning figure.

The owner's advisers assess the tax position, funding requirements and legal arrangements. IN ensures the collection is properly represented in that work and records the owner's intentions for their lawyer to incorporate into the appropriate documents.

IN is paid by the owner, or on their behalf, and by nobody else.

Preparing the next generation.

The people inheriting a collection may not share the owner's knowledge or enthusiasm. They may know little about why a car was bought, its significance, its value or the responsibilities that come with keeping it.

IN introduces the next generation to the collection while the owner can still tell its story. This can include a private day with the cars, a written account of what each person may inherit and a clear explanation of how the cars are cared for. The owner's recollections are preserved alongside the documented history.

The family can then consider what they would like to retain with an understanding of both its meaning and its practical demands.

When the time comes.

The executors receive the Estate and Succession Record and a single point of contact who already knows the collection.

IN helps establish the current position, coordinates any further valuations or specialist work required and oversees the cars' continuing care while decisions are made. Where a sale or transfer is needed, the documentation is available to support it.

The family and executors can act from an informed position, with less dependence on incomplete files, unfamiliar suppliers or the owner's memory.

What brings an owner here.

An owner may want to understand how the collection fits into their estate, whether the family could afford to retain it or which cars should eventually be sold. Others want their children to understand what they will inherit, or need their intentions properly recorded.

Families and executors can also commission IN after a death, when they have inherited responsibility for cars they do not fully understand.