Payment of capital to beneficiaries

By Tolley in association with Peter Gausden, Consultant Solicitor at Rowlinsons
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The following Trusts and Inheritance Tax guidance note by Tolley in association with Peter Gausden, Consultant Solicitor at Rowlinsons provides comprehensive and up to date tax information covering:

  • Payment of capital to beneficiaries
  • Transfers to legatees
  • Capital gains tax on later disposals by legatees
  • Practical capital gains issues involving personal representatives and beneficiaries
  • Payments of capital out of a two year discretionary trust
  • Payments of capital under post death variations

This guidance note specifically addresses issues on the payment of capital to beneficiaries, including transfers to and disposals by legatees along with some practical considerations for personal representatives and beneficiaries. The note should be read in conjunction with the following notes:

  • Capital Gains Tax issues
  • Income tax and capital gains tax during administration
Transfers to legatees

For capital gains tax purposes a ‘legatee’ is:

  • any person taking under a testamentary disposition, or
  • on total or partial intestacy
  • whether beneficially or as trustee, and includes
  • a person taking a donatio mortis causa

TCGA 1992, s 64

More on Beneficiaries' tax position: