CAT Reliefs

Question 1

what is the rule for the CGT/CAT offset

Answer 1

CGT paid can be credited against CAT arised

donee must retain asset for 2 years => clawback

Question 2

conditions for favourite niece/nephew relief

Answer 2

• 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

Question 3

what is full time basis for niece nephew rule

Answer 3

24 h a week
15h a week if business controlled by disponer

Question 4

if gift to niece/nephew comprises of both business and non business assets, how is it charged

Answer 4

group a for business assets
group b for rest

Question 5

what is the relief for surviving spouse of a deceased person

Answer 5

stand in the shoes

Question 6

examples of agricultural propery

Answer 6

pasture, woodlands, farm animals, farm machinary, buildings on farm

Question 7

what are the two tests to qualify for agricultural relief

Answer 7

farmer test
activity test

Question 8

what is the farmer test

Answer 8

80% or more of assets must be agricultural assets

Question 9

activity test conditions for agricultural relief

Answer 9

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

Question 10

what liabilities are subtracted in farmer test

Answer 10

only those related to PPR

Question 11

what is the agri relief

Answer 11

90% of market value of agri assets subtracted

Question 12

how are unsecured liabilities handled in agri relief

Answer 12

apportioned according to portion of agri/non agri assets

Question 13

how are secured liabilities handled in agri relief

Answer 13

apportioned

agri portion multiplied by 10%

Question 14

how are considerations handled in agri relief

Answer 14

apportioned same as unsecured liabilities

Question 15

what is the clawback for agri relief

Answer 15

if disposed within 6 years and proceeds not used to replace/buy another agricultural asset within 1 year

clawback

Question 16

if conditions are met for both agri and business relief, what should be claimed

Answer 16

agri relief

Question 17

business assets example for business relief

Answer 17

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)

Question 18

whats the minimum period of ownership of disponer of business assets for business relief

Answer 18

5 years for gift

2 for inheritance

else no relief

period of ownership from spouse also carried over

Question 19

does replaced business property qualify for business relief

Answer 19

yes if still meets minimum period of ownership

Question 20

how are liabilities accounted for in business relief

Answer 20

no apportionment

business liab taken from business asset

non business liab taken from non business asset

Question 21

clawback for business relief

Answer 21

if disposed within 6 years and not replaced

not applicable on death of beneficiary

different rules for bankrupcy

Question 22

what is business relief rate

Answer 22

90% taken off after costs deducted

Question 23

what relief is available on dwelling house

Answer 23

house and 1 acre CAT free

(ignored in group threshold)

Question 24

conditions for dwelling house exemption on INHERITANCE

Answer 24

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

Question 25

conditions for dwelling house exemption on GIFT

Answer 25

donee must be dependent relative

relative must have occupied for 3 years prior

must have interest in no other dwelling

must occupy for 6 years following

Question 26

what is a dependent relative

Answer 26

u 65 permanently ill/incapacitated

> 65

Question 27

rule for dwelling 6 years after gift/inheritance

Answer 27

deemed to occupy rules

ie employment abroad, long term medical care eg nursing home