Capital Gains Tax (CGT) mitigation
Payable at the taxpayer’s marginal rate of tax, capital gains
tax may be deferred indefinitely, and tax paid on gains realised in the previous three years may be reclaimed from the Inland
Revenue, WITH INTEREST.
Forward Planning and the use of suitable Trusts and Tax Law may allow an individual to avoid
the Capital Gains Tax liability altogether.
It is possible to defer the Capital Gains Tax Liability whilst at the same
time taking advantage of Business Property relief (BPR) and thus reducing the potential Inheritance Tax liability.
Strategies
for Capital Gains Tax Mitigation
Some potential strategies for reduction of tax are listed below, but please contact
us direct to discuss your own personal situation.
- Investment into Venture Capital trusts for deferral
of Capital Gains Tax on realised gains, with the benefit of tax free growth
- Investment into Enterprise
Investment Schemes and Portfolios for deferral of Capital Gains Tax. Such an investment will also benefit from tax-free growth
and the qualification for Business Property relief.
- Bespoke Reinvestment Relief Companies are designed
to qualify under the CGT reinvestment Relief rules and clients may retain 100% control of share-ownership.
- Base
Cost Step Up may be used to step-up the base cost of an asset pregnant with capital gains by use of an offshore trust in order
to dispose of that asset free of any gains. The UK resident may then have the proceeds of that sale with no liability to CGT.
- Incorporation Relief may be available by transferring a property letting business to a company for
shares without giving rise to CGT, and claiming Rollover Relief (under s162 TCGA 1992), it is possible to eliminate all tax
liabilities on the eventual sale.
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