CGT & IHT on IIP Trust

[Tax Dxb]

Settlor father created an IIP trust of land in 2001 for son who will now take absolutely on attaining 35 (this will happen before March 2008). What are the tax implications - CGT & IHT - when land is appointed to son absolutely? What are the major pitfalls? For example, is there any tax benefit in creating a further IIP trust. The value of the land is well above the nil rate band.

[Lee Young]

IHT - non event as the son is already deemed, under IHT rules, to own the assets in the trust.

CGT - disposal by the trustees, unrealised gain will be taxed on them.

[Tax Dxb]

IHT - yes, that makes sense. GCGT - bring on the weird and wonderful world of hold-over relief. Anyone on here an expert on this - trust of agricultural land.

[liam fisher]

Do you have further information about the Agricultural Land?There is some hold over relief on Agricultural Land so that the gain at date of transfer would be deferred until the transferee disposes of the asset.

[Lee Young]

Provided APR applies to the land , the trustees should be able to hold over the gain under s165 TCGA 1992.