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Tricky taper calculations

09 October 2000 / David Whiscombe
Issue: 3778 / Categories: Forum & Feedback , Capital Gains

When shares are transferred from husband to wife, the wife's 'qualifying holding period' is treated as including any time when the husband owned them. (Obviously the same applies on transfers from wife to husband, but this item will be more comprehensible if I avoid terms like 'transferring spouse' and 'transferee spouse'.) But the question whether they are business assets or not is determined entirely by reference to her own circumstances, not by reference to her husband's.

When shares are transferred from husband to wife the wife's 'qualifying holding period' is treated as including any time when the husband owned them. (Obviously the same applies on transfers from wife to husband but this item will be more comprehensible if I avoid terms like 'transferring spouse' and 'transferee spouse'.) But the question whether they are business assets or not is determined entirely by reference to her own circumstances not by reference to her husband's. When she comes to dispose of the shares the question has to be asked — has the company been her 'qualifying company' throughout the 'qualifying holding period'? If the answer is 'yes' — business taper will be due for the whole period. If not the gain will be apportioned. One effect of the Finance Act 2000 changes is that a company can be an individual's qualifying company even if...

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