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Instruments executed on or after 1 August 2002 must contain a valid statement of intent, under IHTA84/S142(2) as amended by FA2002/S120 (1), that the provisions of IHTA84/S142 (1) shall apply to the variation.  If the instrument does not contain such a statement it is ineffective for the purposes of IHTA84/S142 (1).

»Ê¹ÚÌåÓýapp statement must include the appropriate statutory references.  »Ê¹ÚÌåÓýapp example given in the notes to the instrument of variation checklist (IOV2) is

“»Ê¹ÚÌåÓýapp parties to this variation intend that the provisions of section 142(1) Inheritance Tax Act 1984 and section 62(6) Taxation of Chargeable Gains Act 1992 shall applyâ€�.

In announcing the revised provisions, however, we stated in Tax Bulletin 60, August 2002:

“…although if an IoV follows old drafting precedents and refers to an election, this would be regarded as a statement of the parties� intent.�

So any instruments executed on or after 1 August 2002 which incorporate wording following the format of the notice of election or referring to an election should be accepted as a valid statement of intent.

You should refer any case where the taxpayers assert that IHTA84/S142 (1) applies but the instrument does not incorporate a statement of intent to Technical.