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Home / Simons-Taxes /Capital gains tax /Part C3 Capital gains exemptions and reliefs /Division C3.5 Holdover relief for gifts of business assets /Holdover relief for gifts of business assets—anti-avoidance provisions / C3.510 Holdover relief for gifts of business assets—residence status of transferee
Commentary

C3.510 Holdover relief for gifts of business assets—residence status of transferee

Capital gains tax

C3.510 Holdover relief for gifts of business assets—residence status of transferee

Where an asset is gifted to another person, the deemed sales proceeds are equal to the market value of the asset at the date of the gift1, which may give rise to a gain in the hands of the transferor with no proceeds with which to pay the tax due. However, where the gift is of a business asset, the business asset gift relief rules allow the transferor's gain to be deferred (or held-over) and the transferee's base cost to be reduced by the amount of the gain held-over2.

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