Question:
I have a trust that was formed by our parents for myself and my three sisters which held a property with residential flats and a few commercial properties. It was sold this year for £300,000, and I was wondering what tax would be incurred to the siblings.
Arthur Weller replies:
If the trust was a bare trust, then the siblings are liable to capital gains tax (CGT) if there was a capital gain on the sale www.gov.uk/hmrc-internal-manuals/capital-gains-manual/cg34320. If the trust was a discretionary trust, then the trustees are liable to the CGT and there are no direct tax consequences for the sibling - www.gov.uk/hmrc-internal-manuals/capital-gains-manual/cg33500 and 33501.
