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TonyTax
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Capital gains tax on shares inherited from a family trust.

Customer Question

Capital gains tax on shares inherited from a family trust. Is the price of the shares for CGT, the price at the date inherited or the date of the deceased person date opt death ?
Submitted: 1 year ago.
Category: Tax
Expert:  TonyTax replied 1 year ago.

Hi.

Can you give me a little more detail about the trust and how it came to be please. What type of trust is or was it?

Customer: replied 1 year ago.

The trust was set up by my late uncle whereby the income from the trust went to his daughter. On her death the trust was wound up and the Capital (shares) passed to me and my brother equally

Expert:  TonyTax replied 1 year ago.
Thanks.

Can you confirm that the trust came into being on your late uncle's death based on his wishes in his will. Did his daughter have a right to the income but not the capital? When was the trust set up?
Customer: replied 1 year ago.

Trust came into being on uncle's death in 1961 per his will.His daughter had the right to the income from the Trust, but not the Capital, although the trustees could at their discretion give tranches of the capital to the daughter if she was in need of it for a specific purpose.

Expert:  TonyTax replied 1 year ago.
Thanks.

Leave this with me while I draft my answer.
Expert:  TonyTax replied 1 year ago.

Hi again.

The trust was an interest in possession trust which you can read about here.

The value of the trust assets as at the date of the daughter's death will form part of her estate for Inheritance Tax purposes (see paragraph 12.9 in the link above) and those values will be the costs for Capital Gains Tax purposes of those assets for the ultimate beneficiaries, you and your brother.

I hope this helps but let me know if you have any further questions.

TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15886
Experience: Inc Tax, CGT, Corp Tax, IHT, VAT.
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Customer: replied 1 year ago.

Thank you for taking such trouble in this case and for letting me have extracts from Tolleys Tax manuals.All this info from yopu has been most helpful.Thank you

Expert:  TonyTax replied 1 year ago.
Thanks.

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