IHTM42117 - Proportionate charges: excluded periods
First quarter
Proportionate charges can arise at any time during the life of the trust except that under IHTA84/S65 (4), no proportionate charge arises if the exit event occurs in the first quarter following
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the day the settlement commenced, or
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the date of a ten-year anniversary.
However, because there is no IHT charge the trustees will not be able to claim Capital Gains Tax (CGT) holdover relief under TCGA92/S260. (CG66883)
New will trusts - S144
IHTA84/S144 allows trustees to distribute from a will trust within two years of the death without a proportionate charge arising.(IHTM35181)
Again, there is no chargeable event, and so holdover relief does not apply to the transfer for CGT purposes.