Gift Trust

What is it?

• A trust used for inheritance tax planning.

• Generally used where the assets being gifted are not laiden with gain such that a Capital Gains Tax charge would not arise on the disposal (transfer or sale!)

• With this trust, it is not possible to defer the Capital Gains Tax liability if one is applicable, see Holdover Gift Trust for details on Capital Gains Tax deferral 

• Falls under the relevant property regime

Most Common Uses

• Gift of cash for a property purchase (with the property purchased in trust)

• Gift (as well as a loan) to allow for a purchase in trust of a property worth more than the tax free allowance

• Gift of cash which can then be loaned out of the trust

• Gift of cash which can then be invested within the trust