Private client briefing for January 2017

TCGA 1992 s 80 and EU law

In Trustees of P Panayi Accumulation & Maintenance Settlements v HMRC (Case C-646/15) on 21 December 2016 Advocate General Kokott of the CJEU provided an opinion on the First-tier Tribunal ruling in this case centred on the compatibility of TCGA 1992 s 80 with the freedom of establishment freedom to provide services and the free movement of capital under the Treaty on the Functioning of the European Union.

Section 80 provides that the migration of a trust resulting from trustees ceasing to be UK resident is a deemed disposal for CGT purposes of the trust fund at market value. The CJEU ruling in National Grid Indus BV (Case C-371/10) confirmed that while the state can charge tax during periods of residence...