How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask TonyTax Your Own Question
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15979
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
Type Your Tax Question Here...
TonyTax is online now

If I receive an inheritance from a family trust, how is this

This answer was rated:

If I receive an inheritance from a family trust, how is this shown on my tax return ?
Hi. Was the inheritance cash? You say it was a family trust. Has it been closed down? Did you receive an R185 certificate or just a cheque?
Customer: replied 2 years ago.
The Trust was set up for a family member who has died and left no will. The proceeds are from the sale of a bond but the Solicitor has said that no R185 certificate is necessary as it is a Capital Gain.
Leave this with me while I draft my answer.
Customer: replied 2 years ago.
If the bond was actually sold as opposed to being surrendered by the family trust then if there is any gain above the trust exemption, it will be assessed to tax on the trust and you need not report the inheritance.
If the solicitor says the bond belonged to each family member, then if your share of the proceeds was more than £44,000 or your share of the gain is more than £11,000, you need to report it in the CG SA108 pages here:
I hope this helps but let me know if you have any further questions.
Customer: replied 2 years ago.
Yes I believe so, there was no will and the Estate was split into 9 shares of the value of the Estate being £23,338. The Trust was closed in 2006. I will enter the amount in this section.
When was the bond sold?
Customer: replied 2 years ago.
I believe in May 2014 , the cheque was received in June 2014.
So, am i right in thinking that you held on to the bond for 9 years from 2006 and that it was sold and not surrendered to the issuing company?
Customer: replied 2 years ago.
That I don't know without talking to the Solicitors, what do I need to ask them
You need to confirm whether the bond was sold or surrendered as the tax treatment is different between the two.
If the bond was sold and you owned it with your family members, then the cost for CGT purposes will be the value of the bond when you inherited it, ie when the relative who left it to you died. Your share of that "cost" will be deducted from your share of the disposal proceeds to arrive at your gain.
If it was surrendered, there should be a chargeable event certificate issued by the insurance company who issued the bond. I won't go into it unless I need to as its complicated and you won't need to know about it if the bond was actually sold.
Customer: replied 2 years ago.
Okay , thank you for your help. If I need to come back to you I will.
OK. Thanks.
TonyTax and other Tax Specialists are ready to help you