Your manager has received schedules of information from Ray and Shanira in connection with their personal tax affairs. These schedules and an extract from an email from your manager are set out below

Schedule of information from Shanira — dated 8 June 2016
I was born in 1960. I am resident and domiciled in the UK. 
Ray and I are getting married on 17 September 2016.

Gifts from Shanira to Ray
 On 1 February 2016, I gave Ray a house situated in the country of Heliosa. We have only ever used this house for our holidays. The house was valued at £360,000 at the time of this gift. I purchased the house on 1 September 1999 for £280,000.

I will make the following further gifts to Ray between now and the end of the calendar year 2016: 
- Painting
 I purchased this painting at auction for £15,000 on 1 March 2012. It is a painting which we both love and would never sell. However, I obviously paid too much for it, as its current market value is only £7,000.

- Shares in Solaris plc 
 I will give Ray the whole of my holding of 7,400 ordinary shares in Solaris plc. The current market value is £9.20 per share.
I acquired these shares on 1 October 2014 when Solaris plc purchased the whole of the ordinary share capital of Beem plc. This takeover was a genuine commercial transaction.

At the time of the takeover: 
- I owned 3,700 ordinary shares in Beem plc, which I had purchased on 1 June 2008 for £12,960.
- In addition to the shares in Solaris plc, I also received £14,800 in cash from Solaris plc. 
- An ordinary share in Solaris plc was worth £8.40 on 1 October 2014.

Extract from an email from your manager — dated 9 June 2016 
Please prepare a memorandum for the client files which addresses the following issues:

(b) Gifts from Shanira to Ray
(ii)
— The maximum possible inheritance tax liability which could arise in respect of the proposed gifts to Ray of the painting and the shares, if Shanira were to follow our advice in respect of their timing, together with the circumstances in which this liability would occur.

Tax manager

(b) Gifts from Shanira to Ray.
(ii) Inheritance tax.                 (5 marks)

Professional marks will be awarded for the approach taken to problem solving, the clarity of the explanations and calculations, the effectiveness with which the information is communicated and the overall presentation. (4 marks)