Trust Implications on CGT

[DonHill]

Following my grandparents death (8+ years ago) I was made a beneficiary (25% share) of an interest in possession trust that owns their property. I am now looking to buy my first property which will be my main residence. I am liable to the higher rate stamp duty as a result of this trust, this a considerable sum to swallow so what I’d like to ascertain is if there are any further tax implications down the line.

If a purchase a property now which I live in as my main residence and come to sell it down the line will it be exempt from any capital gains tax?

I understand if I sold that main residence and then purchased a new one I’d get relief from the higher rate stamp duty. So aside from the additional stamp duty bill now are there any obvious direct further tax implications to me as a result of having this trust holding?

Thanks

[maths]

If a purchase a property now which I live in as my main residence and come to sell it down the line will it be exempt from any capital gains tax?

Yes. If you live in the property whilst you own it then there is no CGT on sale.

I understand if I sold that main residence and then purchased a new one I’d get relief from the higher rate stamp duty.

Correct.

So aside from the additional stamp duty bill now are there any obvious direct further tax implications to me as a result of having this trust holding?

Not particularly. If the trust property is appointed out to the beneficiaries including you who then sell you may have a CGT charge on your part of any gain. Unlikely to be any IHT issues.

How much i the trust property worth?

[DonHill]

Thanks maths

Property is worth £1+m. My understanding is if the house was sold and cash appointed to the beneficiaries then any capital gains would be charged to the trustrees (and paid from trust assets). But one of the other beneficiaries lives there (has done for years) so we actually qualify for principle private residence relief against any gain

I'd assume the same logic would apply if the property was appointed to the beneficiaries. Then going forward from the point it was appointed i'd be liable to capital gains upon sale as it'd be a 2nd home (assuming I purchase my first property shortly)?

[maths]

If private residence relief for CGT purposes is available to the trustees it would make sense for them to effect any sale.