Individuals making a Capital Gains Tax (CGT) disposal should bear in mind a recent tribunal clarifying beneficial and legal ownership issues, according to Essex-based accountant Rickard Keen.
In Lawson v Revenue and Customs [TC01206] the taxpayer successfully appealed against a decision by HMRC that the taxpayer was the sole legal and beneficial owner of a property. HMRC said that the whole of the capital gains tax should be charged to Mrs Lawson.
Mrs Lawson successfully argued that her husband was entitled to a half share of the capital gain arising as he was also a beneficial owner.
The first tier tribunal ruled that the true purpose of purchasing the property was to provide stable and secure accommodation for the taxpayer’s daughter, as opposed to being held for investment purposes.
The tribunal decided that the taxpayer and her husband shared all assets between them and held an equal and beneficial interest in all properties owned. This was on the basis of their relationship, irrespective of who held the legal title.