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Capital Gains Tax Pool

Sale of property by a trust

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When a trust sells a property and CGT payable, should there be a separate CGT tax pool maintained, apart from normal revenue tax pool ?

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By Tax Dragon
19th Aug 2021 17:11

Distributions of capital cash come within the IHT regime, not the CGT one.

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By The Dullard
10th Sep 2021 14:20

I think you mean not the IT one. The dispoal by the trust to a third party is a CGTable event and any distribution of the proceeds is an appointment of capital, subject to an exit charge.

OP, there is no "CGT pool".

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By Tax Dragon
10th Sep 2021 17:41

The Dullard wrote:

I think you mean not the IT one.

That too. My comment was supposed to help the OP understand (or at least encourage him/her to think about) why there's no (provision in law for a) CGT pool.

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By [email protected]
10th Sep 2021 13:05

H

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By The Dullard
10th Sep 2021 14:20

O

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paddle steamer
By DJKL
11th Sep 2021 00:29

Do you possibly mean within the accounts where you may be keeping distinct accounts for income and capital?

I am not sure how prevalent keeping accounts of charge and discharge for both income and capital are these days in England,, in fact no idea if they ever were even used within English Trusts, but up here I was still receiving them up to about ten years ago.

When I started acting as a trustee they were the norm but tended to only be of import when the trust had both parties with a life interest and different parties as residual beneficiaries, they are though a good way (once you get your head round them , which took me a while) of accounting for the interests of the different parties within a trust .(especially where say the capital side was struggling with liquidity issues)

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By Tax Dragon
11th Sep 2021 08:23

Wait, what? Were we supposed to stop accounting for income and capital separately? We missed that development. (Actually, I think it more likely you've invented that development. It'd make no sense to me. Especially since PAA2009 increased the maximum permitted accumulation period - or more accurately abolished the restrictions, not the concept - for new trusts.)

Whichever, it won't now surprise you to be told that we'd still charge CGT to capital account. If that was the question, OP, you should've asked it.

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