This is no free-for-all, however, as the total government fund will be £30m a year, and that will have to cover the existing acceptance-in-lieu scheme for deceased estates. Also, the scheme will only apply to 'pre-eminent' works of art. Whether a work qualifies as pre-eminent will be decided by an independent panel of experts.
For those leaving at least ten per cent of their estate to charity, the scheme reduces their rate of inheritance tax from 40 to 36 per cent.
The biggest change comes for qualifying art bequests that can be offset against income tax and capital gains tax, with individuals able to claim the equivalent of 30 per cent of the value of the gift over a five-year period. For example, the gift of a painting valued at £1.5m would lead to a total reduction in the donor's individual tax liability of £450,000 over five years.
A similar scheme for companies provides for a maximum saving in corporation tax of 20 per cent of the value of the artwork.
The announcement of the scheme came in the Government's Autumn Statement.
