Tax on trust property

In 2004 a client and his daughter (A) loaned a friend (B) £110,000 to buy a property which cost £120,000.Shortly afterwards A and B drew up a Declaration of Trust. it stated that B as trustee should hold the property for life. He lived there and was resposible for all running costs of the property. He spent about £40,000 on improvements.He paid no rent or interest to A. B also agreed that on his death to leave his share in the net proceeds of the property to A . His Will included this. The trust deed  further stated that B would hold the property upon trust to sell the same and stand possessed of the net proceeds of sale upon trust and for himself and A as tenants in common in the following shares - A 70% and B 30%. B has now died and A has taken full ownership of the property and wishes to sell it for about £220,000. .Does anyone have any thoughts on the tax implications for my client?

I think he has received 30% X £220,000 under the Will so free of tax. The 70% X £220,000 = £154,000 could be treated as a disposal with £110,000 as a deductible cost giving a gain of £44,000. However would it be my client or the trust that is taxable?

 

any comments would be appreciated.