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Too good to be...

04 March 2008
Issue: 4148 / Categories: Forum & Feedback
Can indexation allowance be 'banked'?

I have seen it publicised that a transfer of assets between spouses (or civil partners) before 6 April 2008 will 'bank' indexation allowance.

However if the transferor would like the shares/asset back is there any reason why they or it could not be transferred back after 31 days and still keep the indexation element?

Written down like this it seems too good to be true and I wonder if this would be doomed to failure under some 'tax avoidance' heading. Is a 31-day period 'pushing it' or would it be better to wait for a longer period and if so what might that longer period be?

I would greatly appreciate readers' thoughts here as if there is a simple way of enhancing the base costs of assets in this way. I would certainly like to advise my clients to take advantage of it....

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