Readers’ forum: Capital gains tax on disposal of shares

My client runs a consultancy business through a limited company for which he owns all the shares. He has two teenage children but is doing ‘forward thinking’ regarding his and their financial affairs and is wondering whether to give them some shares in the business. I have warned him that if he gives shares now then any dividends that they yield will be treated as his for income tax purposes; but that this will not be the case once they turn 18.

I am now wondering whether this advice is correct. Am I right in thinking that if he were to give some of his original shares there would not be an income tax issue?

My thoughts are that the Arctic Systems decision would apply here in that he would be giving rights to both income and capital. However he was thinking that a separate class...