CAT Reliefs Flashcards
what is the rule for the CGT/CAT offset
CGT paid can be credited against CAT arised
donee must retain asset for 2 years => clawback
conditions for favourite niece/nephew relief
- child of disponer’s brother/sister
child of civil partner of disponer’s brother/sister
must have worked on a full time basis in disponer’s business for 5 years prior to gift/inheritance
business asset
what is full time basis for niece nephew rule
24 h a week
15h a week if business controlled by disponer
if gift to niece/nephew comprises of both business and non business assets, how is it charged
group a for business assets
group b for rest
what is the relief for surviving spouse of a deceased person
stand in the shoes
examples of agricultural propery
pasture, woodlands, farm animals, farm machinary, buildings on farm
what are the two tests to qualify for agricultural relief
farmer test
activity test
what is the farmer test
80% or more of assets must be agricultural assets
activity test conditions for agricultural relief
holds agricultural qualification or will within 4 years
else
20h+ a week on farm
else
farm leased to someone who meets conditions for min 6 years
what liabilities are subtracted in farmer test
only those related to PPR
what is the agri relief
90% of market value of agri assets subtracted
how are unsecured liabilities handled in agri relief
apportioned according to portion of agri/non agri assets
how are secured liabilities handled in agri relief
apportioned
agri portion multiplied by 10%
how are considerations handled in agri relief
apportioned same as unsecured liabilities
what is the clawback for agri relief
if disposed within 6 years and proceeds not used to replace/buy another agricultural asset within 1 year
clawback
if conditions are met for both agri and business relief, what should be claimed
agri relief
business assets example for business relief
business eg sole trader
shares in company
- beneficiary owns >25%
- company control w connected person
- employed prev 5 years, 10% shares
land/building/equipment/plant
(not farmhouse)
whats the minimum period of ownership of disponer of business assets for business relief
5 years for gift
2 for inheritance
else no relief
period of ownership from spouse also carried over
does replaced business property qualify for business relief
yes if still meets minimum period of ownership
how are liabilities accounted for in business relief
no apportionment
business liab taken from business asset
non business liab taken from non business asset
clawback for business relief
if disposed within 6 years and not replaced
not applicable on death of beneficiary
different rules for bankrupcy
what is business relief rate
90% taken off after costs deducted
what relief is available on dwelling house
house and 1 acre CAT free
(ignored in group threshold)
conditions for dwelling house exemption on INHERITANCE
disponer’s main residence on death
beneficiary must have occupied for 3 years prior
beneficiary must have no other dwelling eg holiday home
beneficiary must occupy for 6 years after
