Readers’ forum: Portfolio transfer
Writing for Taxation magazine, BKL tax adviser Terry Jordan answers a query about estate planning issues on transferring an investment portfolio to a trust.
My client created a settlement for his grandchildren many years ago. It qualifies as an interest in possession trust because it was created before 2006.
He would now like to do some more estate planning and is minded give away a personal investment portfolio, which is worth nearly £600,000. Of course, he would prefer to do this this without incurring any tax charges.
The trust has cash available, but not enough to cover the whole of the market value of the investments. Further, the trust has substantial capital losses. These amount to about £250,000, so would be able to cover the unrealised gains within the portfolio. How can the portfolio be transferred to the trust with minimal taxes?
Query 18,991– Tweeter.