DEFINITION of 'Capital Transfer Tax'

An inheritance tax levied in the United Kingdom on estates exceeding a certain value. The Capital Transfer Tax replaced the general estate duty in 1975, and was itself replaced by the Inheritance Tax (IHT) in 1986. The amount of tax was derived from the value of the deceased's assets transfered within a certain time of the death (both real estate and personal), less charitable gifts.

BREAKING DOWN 'Capital Transfer Tax'

Capital transfer taxes and other inheritance taxes make up a small portion of taxes collected in the United Kingdom. This is partially due to the nil rate band, which is the range of estate values that are excluded from the tax, as well as the various methods for avoiding its payment. Gifting an estate to charities or family members or creating a trust were two avoidance methods used.

RELATED TERMS
  1. Estate Tax

    A tax levied on an heir's inherited portion of an estate if the ...
  2. Inheritance Tax

    In some states in the U.S. (and in the United Kingdom), a tax ...
  3. Transfer Tax

    Any kind of tax that is levied on the transfer of official documents ...
  4. Death Taxes

    Taxes imposed by the federal and/or state government on someone's ...
  5. Uniform Transfer Tax

    A combination of federal estate taxes and federal gift taxes. ...
  6. Estate

    A person's estate is everything comprising the net worth of an ...
Related Articles
  1. States With the Highest Inheritance/Estate Taxes

    State and federal estate taxes may be levied upon death, but there's a difference between inheritance taxes and estate taxes. Here's what you need to know.
  2. Taxes

    Estate Taxes: Who's on the Hook?

    Inheritance taxes can be tricky. Most people have to deal with them at a very inconvenient time. It's better to learn the laws now so you're ready later.
  3. Taxes

    An in Depth Look at How Inheritances Are Taxed

    The tax implications of an inheritance can be complex. Here's what beneficiaries need to know.
  4. Taxes

    How Much Will You Owe on Your Inheritance?

    Estate planning can be unpleasant, but in order to get the full benefit of what you've inherited, it’s important to be prepared for the related taxes.
  5. How Estate Taxes Work, A Real Life Example

    The estate tax is frequently misunderstood. Learn more details about exactly how estate, or inheritance, taxes work in the United States.
  6. Taxes

    8 States With Estate Taxes

    Understand the difference between the federal estate tax and state-specific estate taxes. Learn about some of the worst states with estate taxes.
  7. Taxes

    Get Ready For The Estate Tax Phase-Out

    Changes to federal legislation will affect how your assets are treated once you're gone - be prepared.
  8. Taxes

    4 Ways To Minimize Estate Taxes

    These four strategies will ensure that most of your money goes to your loved ones, and not to the government.
  9. Financial Advisor

    How Life Insurance Can Help Reduce Estate Taxes

    Inheritance is a double-edged sword, as leaving money can create estate tax burdens. Opting for a life insurance plan can help mitigate those burdens.
  10. Retirement

    Estate Planning and Elderly and Passed Clients

    By keeping up with new estate tax rules, financial advisors can help elderly clients save big on tax costs.
Hot Definitions
  1. Graduate Record Examination - GRE

    A standardized exam used to measure one's aptitude for abstract thinking in the areas of analytical writing, mathematics ...
  2. Graduate Management Admission Test - GMAT

    A standardized test intended to measure a test taker's aptitude in mathematics and the English language. The GMAT is most ...
  3. Magna Cum Laude

    An academic level of distinction used by educational institutions to signify an academic degree which was received "with ...
  4. Cover Letter

    A written document submitted with a job application explaining the applicant's credentials and interest in the open position. ...
  5. 403(b) Plan

    A retirement plan for certain employees of public schools, tax-exempt organizations and certain ministers. Generally, retirement ...
  6. Master Of Business Administration - MBA

    A graduate degree achieved at a university or college that provides theoretical and practical training to help graduates ...
Trading Center