CGT base cost of inherited ISA investments?

Trusts Discussion
1

I am administering an estate which includes an ISA and a non-ISA portfolio of shares. The executors have instructed the broker to transfer the investments in both portfolios to the residuary beneficiaries. Both portfolios have increased in value significantly since the date of death and we have had some debate with the broker as to the beneficiaries’ base costs of the various investments for CGT purposes going forwards.

I have always understood the beneficiaries to be deemed to have acquired the shares as at the date of death value, however there appears to be an anomaly in terms of investments held within an ISA wrapper. S34A Individual Savings Account Regulations 1998 suggests that a legatee is deemed to acquire the investments with a base cost equivalent to the value at the date of transfer to them. I cannot easily see a definition of legatee - do readers agree that this applies to a residuary beneficiary receiving shares from an ISA as part of residue?
Many thanks
Kelly Wardell

2

See TCGA 1992 ss4A and 4B which effectively provide for an override to the "normal rule"of
s 62(4)(b).

“Legatee” defined in s64(2).

Malcolm Finney

3

Sections 4 to 14 have been repealed wef 6/4/20.

The override provision is Reg 34A SI 1998/1870.

4

Malcolm. those sections appear to have been replaced by FA 2019, although legislation.gov.uk has still not incorporated them in the latest revised version of TCGA. Per CG10150 they are supposed to have migrated to new sections 1I and 1J. I don’t see how your answer is to be found there.

Jack Harper

5

Apologies.

Just taken a quick look between naps. Need to recheck but believe override is provided in TCGA 1992 ss62(4A) and (4B).

Malcolm Finney