Article - Transfer chargeable assets between spouses before 5 April 2008
From 6 April 2008 the Government are introducing a new method for calculating the capital gain on the sale of chargeable assets.
The gain will be based on the difference between the selling price and the cost or, if the asset was held on 31 March 1982, the value at that date.
Previously, if an asset was bought before 5 April 1998, you were allowed a relief to compensate for inflation in the form of Indexation Allowance.
Indexation Allowance was calculated between the date of purchase and 5 April 1998. However after 5 April 2008 this relief will be lost.
Until 5 April 2008, an asset passing across between a married couple or civil partners living together, which was purchased after 31 March 1982, is treated as passing on a no gain! no loss basis with the recipient acquiring it at the transferor's cost plus indexation to 5 April 1998. Unfortunately for assets purchased before 31 March 1982, the benefit of indexation cannot be added to the value at which the transferee is deemed to acquire the asset.
If you hold any high value assets such as property, that is not your principal private residence, which were bought between 31 March 1982 and 5 April 1998, you may wish to consider transferring ownership to your spouse or civil partner to preserve the advantage of the Indexation Allowance.
If you believe that a transfer of assets will be beneficial and wish to discuss this further, please feel free to telephone.
Click here for an example of asset transfer between spouses before 5 April 2008
