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Enactment of ESCs

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The draft Enactment of Extra-Statutory Concessions Order 2017 will make provision in primary legislation for three existing HMRC extra-statutory concessions, with effect from 6 April 2017. The concessions are:

  • ESC D40, which concerns the CGT charge in respect of gains made by trustees of a non-resident trust, ensuring that a beneficiary is not treated as a participator in a company controlled by the trustees merely because of its status as beneficiary;
  • ESC F15, which ensures that where a transfer of value involves woodlands subject to a deferred estate duty charge, a potentially-exempt transfer for IHT purposes will be denied only to the extent that the value transferred is attributable to those woodlands; and
  • ESC 3.20, which prevents disallowance of input VAT for supplies made prior to insolvency.

HMRC consulted on these changes in October 2014 and November 2015 respectively.