This is further to an earlier post. I am currently proceeding on the basis that the Beneficiary received an absolute entitlement at 35.
In terms of this query;
Non UK Trust - beneficiary become absolutely entitled to Trust assets. We believe all assets are outside the UK
Are there any exemptions between s71 TCGA (absolute entitlement and deemed disposal) and s87? Or, will the beneficiary find herself with capital gains to declare which are equal to the deemed gains which have arisen on her receiving an absolute entitlement?
Or, will this gain be limited to those that arose in the life of the Trust?
TCGA 1992 s97(2) makes it clear that a “capital payment” includes “any occasion on which settled property becomes property to which s60 applies” ie where a beneficiary becomes absolutely entitled to trust property.
On the beneficiary becoming absolutely entitled the deemed trustee gains which arise (s71) then form part of the s2(2) amounts. Accordingly, the capital payment to the beneficiary(s) is matched to the s2(2) amount(s) which arise. TCGA 1992 s87A dictates the order of “matching” (broadly, commonly referred to as the adoption of the LIFO basis; as opposed to FIFO).