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Buachaill, Barrister
Category: Law
Satisfied Customers: 10978
Experience:  Barrister 17 years experience
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If a discretionary trusts "gifts" a property to someone does

Customer Question

If a discretionary trusts "gifts" a property to someone does the Trust have to pay CGT
Submitted: 2 years ago.
Category: Law
Expert:  Buachaill replied 2 years ago.
1. Capital Gains Tax is payable on any "gain" realised upon the transfer of an assets. Accordingly, if a discretionary trust transfers an asset to a beneficiary for zero consideration or value, there is no "gain" and hence no taxable event. Similarly, as the trust is disposing of the asset for zero, there is no taxable gain, so no CGT Payable.
Expert:  Buachaill replied 2 years ago.
2. The position after the transfer by the trust to the beneficiary for zero consideration is that the asset is then held at zero value by the beneficiary. Accordingly, any subsequent sale or transfer for value by the beneficiary will attract CGT as any sale price is a "gain" and hence a taxable amount (subject to deductions of course).
Expert:  Buachaill replied 2 years ago.
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