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Readers' Forum
Replies to Queries — 1
Landed with a gift
I act for a client family partnership which consists of the mother, the father and their only son. There is some land on which buildings stand and these have been used in their trade of a holiday centre for storage purposes.
Readers' Forum
Replies to Queries — 1
Landed with a gift
I act for a client family partnership which consists of the mother, the father and their only son. There is some land on which buildings stand and these have been used in their trade of a holiday centre for storage purposes.
As far as the father is concerned, this has been the case throughout the period of ownership, so in relation to his half share it seems that section 165, Taxation of Chargeable Gains Act 1992 holdover relief can be claimed without any need to restrict this for non-business use. However, his wife was only admitted as partner on 1 March 2004 and she has not therefore been involved in the trade throughout the period of her half share of the ownership of the asset.
My view is that this may not have a bearing on the availability of the section 165 relief. The rationale for this is that paragraph 5(1) of Schedule 7 to the Taxation of Chargeable Gains Act 1992, which deals with restrictions peculiar to assets, refers to the asset not being used for the purpose of the trade throughout the period of ownership. The fact is that it was so used for the purpose of the trade and it is only the case that the mother was not involved in the trade throughout the period of ownership.
Section 165(2) only refers to an interest in or an asset used for the purposes of a trade by the transferor.
Readers' views would be welcomed.
(Query T16,484)
