A back to basics guide, by Ben Handley and Sadiq Hashmi (BDO).
When a person sells an asset at under value then as tax advisers we must always apply healthy scepticism and consider why. In reality most persons will only give assets away to close family or charity otherwise there is usually some other motive behind an apparent gift that will have wider tax consequences: for example it may be a thank you for service which would make the gift a payment for those services. In contrast a person may be more willing to sell an asset at undervalue to a wider class of friends and family i.e. to sell at cost or at a discount. Nevertheless scepticism should still be applied.
For tax purposes a sale at undervalue will always include a gratuitous element and consequently the tax...
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A back to basics guide, by Ben Handley and Sadiq Hashmi (BDO).
When a person sells an asset at under value then as tax advisers we must always apply healthy scepticism and consider why. In reality most persons will only give assets away to close family or charity otherwise there is usually some other motive behind an apparent gift that will have wider tax consequences: for example it may be a thank you for service which would make the gift a payment for those services. In contrast a person may be more willing to sell an asset at undervalue to a wider class of friends and family i.e. to sell at cost or at a discount. Nevertheless scepticism should still be applied.
For tax purposes a sale at undervalue will always include a gratuitous element and consequently the tax...
If you or your firm subscribes to Taxjournal.com, please click the login box below:
If you do not subscribe but are a registered user, please enter your details in the following boxes:
