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CG33290 | Basic terms of trust law as applied to CGT: separate settlements

From HM Revenue & Customs · Capital Gains Manual

It is necessary to know whether there is one settlement or more for the following reasons:

  1. The annual exempt amount is given to the trustees of the settlement. If there are several settlements then each has its own annual exempt amount. The annual exempt amount varies according to the number of post-June 1978 settlements with the same settlor.

  2. Losses of one settlement cannot be set against the gains of another.

  3. The CGT assessment is made on the trustees of the settlement, not on the trustees of separate funds within a settlement, see CG33340 and CG35400+.

  4. If assets are moved from one fund to another within a settlement, there is no disposal, but if assets are transferred from one settlement to another, then that is a disposal of those assets.

  5. TCGA92/S77, see CG34700+, applies if the settlor or the settlor's spouse or civil partner can or does benefit under the settlement.

  6. For the purpose of valuing unquoted shares, for example on 31 March 1982 the blocks belonging to the trustees of separate settlements are valued separately.