Scrip dividends and the exit charge
In Meena Seddon and others v HMRC [2015] UKFTT 140 (9 April 2015) the FTT confirmed notices of determination in relation to a settlement.
The appellants were the trustees of a settlement. They had received a scrip dividend and a few days before the tenth anniversary of the commencement of the settlement they had made a distribution worth over £1m to certain beneficiaries. The issue was the rate of the exit charge for IHT purposes.
The trustees contended that the scrip dividend was income and had not been accumulated as capital. As such it did not fall to be taken into account in calculating the exit charge and so no tax was due on the distribution. HMRC argued that the scrip dividend was capital and that trust property had ceased to be ‘relevant property’ and so an exit charge...
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Scrip dividends and the exit charge
In Meena Seddon and others v HMRC [2015] UKFTT 140 (9 April 2015) the FTT confirmed notices of determination in relation to a settlement.
The appellants were the trustees of a settlement. They had received a scrip dividend and a few days before the tenth anniversary of the commencement of the settlement they had made a distribution worth over £1m to certain beneficiaries. The issue was the rate of the exit charge for IHT purposes.
The trustees contended that the scrip dividend was income and had not been accumulated as capital. As such it did not fall to be taken into account in calculating the exit charge and so no tax was due on the distribution. HMRC argued that the scrip dividend was capital and that trust property had ceased to be ‘relevant property’ and so an exit charge...
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