Gifts: Finance Act 2004 changes: gifts to settlor-interested settlements: donee becomes settlor-interested settlement after hold-over relief obtained
Subject to certain exceptions, any hold-over relief under TCGA92/S165 obtained in relation to a “relevant disposal” (see CG66921C) must be recovered from the donor where the relevant disposal is to the trustees of a settlement if, within the “clawback period” (see CG66921C) (but after the relief was claimed)
- the settlement becomes a “settlor-interested settlement” (see CG66921A), or an “arrangement” (see CG66921A) comes into existence under which the settlement will or may become a “settlor-interested settlement”,
- the donor is not an individual who has died before the “material time” (see CG66921C).
[TCGA92/S169C (1), (2), (5) and (6)]
The exceptions to this general rule are explained in CG66924.
CG66922+ tell you how the clawback provisions work and what consequential tax adjustments must be made. If the claim for hold-over relief under TCGA92/S165 is revoked or withdrawn, the provisions of TCGA92/S169C will apply as though the claim had never been made (see CG66919).
Officers of the Board are given powers to obtain information for the purposes of TCGA92/S169B to TCGA92/S169F. Penalty proceedings under TMA70/S98 can be taken against someone who fails to produce this information (see CG66925).