Part 2: Inheritance Tax Section 9: Increased nil-rate band on death where home inherited by descendants etc. Details of the section Section 8K: Meaning of "closely inherited"
New section 8K explains the meaning of "closely inherited" and hence when something is inherited by direct descendants of the deceased ("D") for the purposes of qualifying for the residence nil-rate band.
	Subsection (1) describes when something is "closely inherited" and the persons who are treated as direct descendants of D. They include D's child, grandchild and other direct lineal descendant, the lineal descendant's spouse or civil partner when D died, and the widow, widower or surviving civil partner of a lineal descendant who died before D. They do not include a surviving spouse or civil partner of a deceased lineal descendant who remarries or forms a new civil partnership before D's death.
	Subsection (3) states that a person who was another person's step-child at any time is to be treated as a child of that other person.
	Subsection (4) allows an adopted person to be treated as a child of a natural parent or an adoptive parent.
	Subsection (5) treats a person who was fostered at any time as a child of the foster parent.
	Subsections (6) and (7) provide that where a guardian or special guardian has been appointed for a person under the age of 18, that person is to be treated as a child of the guardian.
	Subsection (8) clarifies that the direct descendants of a step-child, adopted person or fostered person, who is treated as a child of another person, are also to be treated as direct descendants of the that person.
	Subsection (9) defines an "adopted person".
	Subsection (10) defines a "foster parent".