The following Trusts and Inheritance Tax guidance note by Tolley in association with Paul Davies at DWF provides comprehensive and up to date tax information covering:
‘Hold-over’ relief allows for the deferral of a gain that would otherwise arise in relation to a disposal. No capital gains tax (CGT) is due in respect of the disposal, but the base cost of the asset for the transferee for the purpose of a future disposal is reduced by an amount equal to the gain that would otherwise have arisen.
Hold-over relief can be of two types:
The relief is optional and has to be claimed.
If both types of hold-over relief are available in relation to a disposal, then general hold-over relief must be claimed instead of business hold-over relief.
Hold-over relief is available to trustees but not to personal representatives. When personal representatives transfer the assets of the estate to the persons entitled to them, no gain will arise in any event.
The assets that qualify for business hold-over relief are:
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