I have posted previously regarding the base cost of inherited ISA investments and note the override of the ‘usual’ rule provided by Reg 34A SI 1998/1870.
I am dealing with a similar case whereby an estate includes an ISA portfolio of shares. We are now more than 3 years post death and the estate remains in administration (largely due to an uncooperative executor and the need for a Court order to remove them). The intention is to liquidate the ISA portfolio which is standing at a significant gain. I am unclear as to the relevant base cost and would appreciate views please - presumably this is either the date of death value, or the value at the 3rd anniversary of the death of the deceased when the ISA treatment ceased?
I can’t see that SI 1998/1870, s34A provides an override to TCGA 1992, s62(1) for the PRs? That regulation 34A provides an override to TCGA 62 (4A) and (4B) which override s62(4)(b) so if an estate beneficiary ends up with the shares they can have an uplift to market value to either the value at 3 year anniversary of death or at date of transfer if earlier but the PRs only get relief for CGT purposes whilst they hold it as an administration period investment (per regulation 22(1a) and once they hold it outside the tax wrapper if they make a sale eg sale after 3 years whilst admin period of estate still open then TCGA 1992 s62(1) is going to apply so the gain for PRs would be on difference between the probate value and proceeds received (or if shares held at death sold within continuing ISA within 3 year window then that gain would be exempt and the post 3 year PR gain would be on cost of new shares acquired cf to sales proceeds but there wouldn’t be uplift in value at 3 year date for the cost) because I can’t see an override provision or am I missing something in the legislation? Any thoughts gratefully received!