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HMRC internal manual

Capital Gains Manual

Gifts in settlement: date of gift

Although in many cases the deed of settlement is also the document which transfers the legal title to the trustees, it is quite common for property to be passed to the trustees before the settlement is drawn up, or for the settlement to be drawn up before the assets are transferred to the trustees.

In the former case the date of gift is the date of the settlement. Until then the trustees hold as bare trustees for the settlor.

The latter case is more complicated. In general, under the law of England, Wales and Northern Ireland, an agreement to settle property is unenforceable, because of the lack of `consideration’. The commonest exception is the case of a marriage settlement where it is common for the deed to specify that property is to be transferred in consideration of the solemnization of the marriage. In such a case TCGA92/S28 (2) applies, see CG14250+. Otherwise there is no disposal until the date upon which the person making the disposal has done everything in his power to effect the transfer. In the case of land this is the date of the conveyance. In the case of shares this is the date when the share transfer form is sent to the company, see Re Rose, [1949] CH499, an Estate Duty case. In some cases the settlor may declare by deed that he holds a particular asset in trust. In this case the date of gift is the date of the declaration.