CGT on Trusts Assets

[crocker-man]

I am trustee on a small trust (~£60,000).

The SA950 guide to help fill in the Trust and Estate Tax Return states in Question 5 -
Fill in the Trust and Estate Capital Gains pages if:
• the trust or estate disposed of chargeable assets worth more than £40,400,

[crocker-man]

The original post has done something odd and of course I cannot delete it. (If any mod can delete the earlier ones please do so)

Anyway the whole story now follows.

I am trustee on a small trust (~£60,000).

The SA950 guide to help fill in the Trust and Estate Tax Return states in Question 5 -
Fill in the Trust and Estate Capital Gains pages if:
• the trust or estate disposed of chargeable assets worth more than £40,400,.......

The current trust CGT annual allowance is just over £5,000, so does that mean that if the trust were to make
a gain of, say, £8,000 on the current tax year that we don't have to tell HMRC?

It seems odd if so, perhaps someone can advise please?

[Lee Young]

The disposal of chargeable assets figure is not the taxabale gain. You could sell a property for a million but only have a tiny gain, or sell a shareholding for £20k but half of it be gain.

The obligation is to report disposals over a certain limit irrespective of whether any taxable gain results from it, and always to disclose dispsoals that do give rise to a taxable gain.

[crocker-man]

Thank you.

So despite the odd way its described, the trust will (as would be expected) need to advise on making chargeable gains over the annual limit or to not exceed the annual allowance by ensuring limiting any gain by selling assets to make the gain not exceed the allowance. If the latter then there is no ned to report anything as it would be below the allowance and the £40,000 obligation (similar to personal tax, I believe).