§ Viscount Mackintosh of Halifaxasked Her Majesty's Government:
Whether, given their stated aim of creating a climate where family companies can flourish, it is their intention that clearance under Section 53(2) of the Finance Act 1982 will in all cases be refused on the death of a controlling shareholder where sufficient dividends can be voted by the executors to enable the inheritance tax liability to be met by instalments on the basis that hardship would not arise as the executors control the company and thus control the flow of dividends.
§ Lord Brabazon of TaraI understand that there have been very few cases of the kind in question. However, where the company has surplus funds sufficient to discharge the inheritance tax liability, the Inland Revenue take the view that there would be no hardship since the liability could be met by dividend payments from the company. If the noble Lord has a particular case in mind, I would be very happy to ask my right honourable friend the Chancellor of the Exchequer to look into it.