FA 2019: CGT exit charges

Lynnette Bober

While the UK remains a member of the EU it has to abide by EU treaty provisions. In addition depending on whether a deal is agreed the UK may have to abide by EU law for some years to come. As such FA 2019 s 22 and Sch 7 have been enacted in response to the CJEU finding against the UK in Trustees of the P Panayi Accumulation & Maintenance Settlements (Case C-646/15). The CJEU held that:

the imposition of an exit charge was acceptable where the residence of a trust shifted to another member state but the provisions had to be proportionate; and
Taxation of Chargeable Gains Act (TCGA) 1992 s 80 was not proportionate as the tax payable as a result of the exit charge could not be deferred.

Schedule 7 introduces Sch 3ZAA (CGT exit charge payment plans) into TMA 1970.

The actual charging legislation is unchanged...

If you or your firm subscribes to Taxjournal.com, please click the login box below:

If you do not subscribe but are a registered user, please enter your details in the following boxes:

Subscribe Now...

Alternatively, you can register free of charge to read a limited amount of subscriber content per month.

Once you have registered, you will receive an email directing you back to read this article in full.

the imposition of an exit charge was acceptable where the residence of a trust shifted to another member state but the provisions had to be proportionate; and
Taxation of Chargeable Gains Act (TCGA) 1992 s 80 was not proportionate as the tax payable as a result of the exit charge could not be deferred.

Schedule 7 introduces Sch 3ZAA (CGT exit charge payment plans) into TMA 1970.

The actual charging legislation is unchanged...

If you or your firm subscribes to Taxjournal.com, please click the login box below:

If you do not subscribe but are a registered user, please enter your details in the following boxes: