Legislation will be introduced in next year's Finance Bill to endbusiness assets gifts relief on the transfer of shares orsecurities to companies. In addition, any such transfers made on or aftertoday will no longer qualify for relief.
The main purpose of the relief is to prevent erosion of business capital when a business is handed down within the family and to prevent the break-up of small businesses. However, the relief is also available where assets used in an unincorporated trade are transferred to a company.
Accorinding to the Revenue: 'There is considerable evidence that this relief is bein widely abused where shares or securities, rather than assets used in a trade, are involved. The relief is being exploited in schemes where the primary purpose is to avoid a CGT liability on an anticipated sale, rather than simplydefer the liability on a bona fide gift.'
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