any extension of holdover relief (to introduce a general gifts relief) would need to be fully considered, including the implications for trusts and corporate capital gains;
the private residence relief rules should be simplified to enable taxpayers to establish their CGT liability easily, in particular looking at: how a main residence is defined, lettings relief, lettings trades, home-office use, job-related accommodation and periods of absence;
the rules on transfers of assets between spouses/civil partners on separation and divorce are also unnecessarily complex, and an extension to the no gain/no loss treatment to a period of two years from the end of the tax year of permanent separation would resolve most of the issues;
the complexities of dealing with deferred consideration (in particular Marren v Ingles rights) could be resolved by taxing unascertainable consideration on receipt as a disposal of the original asset (and not a chose in action);
the 5% test of ownership in business asset disposals relief (formerly entrepreneurs’ relief) gives rise to potential distortions in behaviour of taxpayers and a trap on inadvertent dilution, and the CIOT also notes that the additional requirements for the 5% test relating to economic ownership are complex to apply and likely to be unfamiliar to many claiming BADR;
the lack of information about holdover claims made in the past is a common problem for property disposals and the CIOT encourages individuals and their agents to record the relevant details when made or incurred in the personal tax account.
any extension of holdover relief (to introduce a general gifts relief) would need to be fully considered, including the implications for trusts and corporate capital gains;
the private residence relief rules should be simplified to enable taxpayers to establish their CGT liability easily, in particular looking at: how a main residence is defined, lettings relief, lettings trades, home-office use, job-related accommodation and periods of absence;
the rules on transfers of assets between spouses/civil partners on separation and divorce are also unnecessarily complex, and an extension to the no gain/no loss treatment to a period of two years from the end of the tax year of permanent separation would resolve most of the issues;
the complexities of dealing with deferred consideration (in particular Marren v Ingles rights) could be resolved by taxing unascertainable consideration on receipt as a disposal of the original asset (and not a chose in action);
the 5% test of ownership in business asset disposals relief (formerly entrepreneurs’ relief) gives rise to potential distortions in behaviour of taxpayers and a trap on inadvertent dilution, and the CIOT also notes that the additional requirements for the 5% test relating to economic ownership are complex to apply and likely to be unfamiliar to many claiming BADR;
the lack of information about holdover claims made in the past is a common problem for property disposals and the CIOT encourages individuals and their agents to record the relevant details when made or incurred in the personal tax account.
