What would HMRC say to this

What would HMRC say to this

Didn't find your answer?

Son gifts unquoted shares to father (gain held over) and 1 month later he sells all the shares paying only 10% tax (ER), whereas the son would have paid 28%.  The proceeds will remain with the father.

Clearly the transaction was carried out to minimise the tax liability but I wonder what HMRC would say and what would the worst case scenario be?
 
 
Many thanks

Replies (3)

Please login or register to join the discussion.

avatar
By justsotax
06th Apr 2011 15:34

how does father pay only 10%...

surely ER not available as shares held for less than 1 year?

Thanks (0)
avatar
By Markhamfc1
06th Apr 2011 15:45

it is

as the father already held over 5% and qualified. Therefore, new shares qulaify straight away.

Thanks (0)
By gbuckell
07th Apr 2011 10:28

Cash with father

The key here is that the sale proceeds remain with the father. If they came back to the son, there would be a serious risk of challenge. In absence of that I think HMRC would struggle to challenge it successfully.

Thanks (0)