Canada Life International is changing the valuation basis it uses for its discounted gift products after the Capital Taxes Office highlighted a change in position.
From today the company says it will be reducing the discount figures it uses in its valuation calculations, for products such as Discounted Gift Trusts, after HM Revenue and Customs (HMRC) informed the company of a change in their thinking, including the need for an "open market buyer" approach to valuations. In a DGT the settlor ‘gifts’ capital into a trust for their family, but retain rights to a regular income stream while they are still alive. So for Inheritance Tax (IHT) purposes the value of the gift is the amount of capital ‘gifted’ to the trust minus the lump sum value of the settl...
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