Capital gains tax on disposal of property

HeinekenTick

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I understand that property acquired at market value between 7 December 2011 and 31 December 2014 and held for at least seven years would be exempt from CGT upon disposal.

My question is: does the above apply when property (e.g. agricultural land) is 'acquired' by a person from his/her spouse as part of a separation agreement that is effective before 31 December 2014?

For example, husband and wife separate. As part of separation settlement, husband transfers 50 acres of land to wife on 1 December 2014 (at market value of land such that number of acres transferred agrees to amount of the settlement). If the wife holds that land for at least seven years, would she be exempt from CGT if she then sold it to a third party?

Thanks.
 
@ircoha
Thanks for the reference which I have read.

My concern is the statement in that document that, when there is a transfer of assets between spouses as part of a separation agreement, that 'the spouse or civil partner receiving the asset is treated as having acquired it at the time and for the same consideration as the transferring spouse or civil partner originally acquired it.'

As such, it appears to me that, if the original acquisition of the assets did not occur between 7 December 2011 and 31 December 2014, then a transfer of assets as part of the separation agreement during that period would be irrelevant for determining the recipient spouse's subsequent exposure to CGT because the date of acquisition for CGT purposes would be the date of original acquisition.

I'd like to be wrong on this.
 
Am guessing here but lets look at some numbers.
wife, wants 500,000 by way of settlement and 50 acres of land at market value of 10,000/acre is on offer.

This land was bought for 2,000/acre prior to 07/12/2011.

Ignore any reliefs, exemption,threshold and the like, there is a gain of 400,000 on the land.
What the husband wants is to transfer this gain to wife at market price, without crystallising the gain and pay any tax.
The rules wont allow that so why does he not sell the land at market price to the wife and pay any tax on it.
Otherwise he will have to pay the tax on gain to date to wife.
 
The husband can transfer land to the wife as part of the separation agreement without triggering any CGT. There is no issue here.

However, the wife does not really want the land, she wants the value in cash so will want to sell the land. Ordinarily, her disposal of land would trigger CGT, which is what I am trying to avoid.

Hence my original question as to whether land 'acquired' by her before 31 December 2014 as part of separation agreement would be exempt from CGT if she holds it for seven years before disposing of it.
 
No because she will step into her husbands shoes as to date and time of original acquisition. You are trying to avoid the CGT on the gain while husband had it
 
I hope this helps you - This is the law.

There is an exempt transaction between spouses in this case .

Where both spouses have been granted a judicial separation under the family law act
1995.

An exempt transaction does not create a gain or loss for capital gains purposes.

So the simple answer is she is not exempt - she will have to pay capital gains tax
 
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