Tax planning - Capital Gains Tax (CGT)
Capital transactions leading to CGT arise mainly from property sales, the sale of a business, the disposal of equity shareholdings, the sale of share options and other capital transactions. CGT planning and compliance has become an important part of the tax services we provide.
Tax planning considerations for CGTObtain principal private residence exemption where possible.
Transfer a residential site from parent to child to avail of exemption from CGT.
Obtain retirement relief on sale of family business.
Obtain relief from CGT on converting your business to a limited liability company. Click here for more information
Careful tax planning clients who may be planning a capital transaction.
The date of the sale of the asset determines the timing of the CGT payment and planning in this area can have cash flow advantages.
In addition to calculating the CGT and filing the returns, it is sometimes possible to approach a transaction in another way and suggest possible alternatives.
Tax planning - Capital Acquisitions Tax (CAT)CAT planning is important to ensure your inheritors don't suffer penal taxes. If your worldly assets exceed the thresholds, the CAT arising can be significant.
The accumulation of wealth over many years can mean that substantial CAT liabilities will arise which will need to be paid by your successors.
Tax planning considerations for CAT
Ensure all deductible costs are claimed.
Obtain principal private residence exemption where residential property has been lived in for three years prior to date of gift or inheritance.
Obtain relief for gifts or inheritances of agricultural property if possible.
Obtain relief for gifts or inheritances of businesses if possible.
Consider setting up a trust, where larger amounts are involved.
There are possibilities available to reduce CAT arising from gifts or inheritances and we can explore the costs and benefits of the alternatives available. We can also prepare the CAT returns and ensure all available reliefs are claimed.
CAT is an important issue in succession planning and careful thought and consideration in advance of retirement can significantly reduce your tax liabilities. Besides passing the business onto their children, owners also want to ensure a continuous income stream for their own retirement.
We can advise on the key tax mitigation issues associated with succession planning and also on the specific commercial issues involved in each individual case.
CAT/CGT planning in a downturn
CAT :Recent declines in asset values and possible future increases in tax rates means now is a good time to consider transferring assets to the next generation.
CGT Losses: Falling asset values can be used to crystallise capital losses now to hold for future offset
