Administration of Estates – “the T word” Continued

The final tax that I will mention is Capital Gains Tax, which is relevant in the administration of estates.

This tax most commonly is relevant in respect of properties and shares. If there are other more complicated assets than that, it is probably better to seek professional advice in respect of Capital Gains Tax.

The Capital Gain can happen between the date of death and the date that the asset is finally transferred to the beneficiary, ie the period of the administration of the estate. If there is a rise in value, then there may be a Capital Gains Tax liability.

The estate has an allowance, as individuals do, so if the value of the Capital Gain is within the allowance, then the Capital Gain will be exempt or taxed at 0%. You will therefore need to check to see what the allowance is and if the Capital Gain is within the allowance.

If there are more than one beneficiary and the Capital Gain is to be spread across the beneficiaries, then the asset can transferred to the beneficiaries before it is sold, so that the gain can be spread across the allowances of the beneficiaries, assuming that the allowances have not been used up for a different Capital Gain.

As with Income Tax, if there are any issues regarding tax, the standard advice would be to go and seek professional advice.