HMRC have published Spotlight 69 highlighting a tax avoidance scheme used by landlords to reduce their tax liability through the liquidation of a Limited Liability Partnership (LLP).
The scheme allows them to transfer their property business to a company using an LLP to save CGT. The scheme involves transferring rental properties with accrued capital gains to an LLP which is then put into Members’ Voluntary Liquidation (MVL) and the properties are sold to a limited company owned by the landlord. HMRC’s view is that this scheme does not work and participants may face additional taxes interest penalties and fees.
For MVLs entered into on or after 30 October 2024 TCGA 1992 s 59AA will apply treating the asset transfer as a disposal making landlords liable for CGT. Additionally FA 2003 s 75A may apply due to the pre-arranged...
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HMRC have published Spotlight 69 highlighting a tax avoidance scheme used by landlords to reduce their tax liability through the liquidation of a Limited Liability Partnership (LLP).
The scheme allows them to transfer their property business to a company using an LLP to save CGT. The scheme involves transferring rental properties with accrued capital gains to an LLP which is then put into Members’ Voluntary Liquidation (MVL) and the properties are sold to a limited company owned by the landlord. HMRC’s view is that this scheme does not work and participants may face additional taxes interest penalties and fees.
For MVLs entered into on or after 30 October 2024 TCGA 1992 s 59AA will apply treating the asset transfer as a disposal making landlords liable for CGT. Additionally FA 2003 s 75A may apply due to the pre-arranged...
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If you do not subscribe but are a registered user, please enter your details in the following boxes:
