We have a client who has a lifetime interest in an Interest in Possession Trust which was created in 1982.
She no longer wishes to have the benefit of the income from the trust and would like to ‘give’ the capital to her daughter. She is thinking of creating a Discretionary trust for her daughter.
The trustees agree with this as the trust gives them the power of advancement.
There are sizable gains on some of the investments.
No IHT will arise on the termination of the interest (pre 2006 IIP trust) and therefore a CGT liability will arise.
I assume that it would not be possible to claim Hold Over Relief if the assets were transferred into the new trust as technically it is the mother who is making the transfer to the daughter.
The IIP trust does add that the daughter is the remainder man and has the property absolutely
There are sizable gains on some of the investments.
No IHT will arise on the termination of the interest (pre 2006 IIP trust) and therefore a CGT lailbity will arise.
I assume that it would not be possible to claim Hold Over Releif if the assets were transfered into the new trust as techinally it is the mother who is making the transfer to the daughter