Portfolio partition

I have two clients (brothers) who own a small property portfolio in joint names. They wish to exchange their half shares such that each owns some of the properties outright.

The disposals of their half shares are of course disposals for capital gains tax purposes at market value as they are connected persons.

There used to be an extra-statutory concession (ESC D26) which gave relief in these circumstances such that no capital gains tax was payable if the joint owners became sole owners.

However this concession was withdrawn in 2010 and from what I have researched has not been replaced by legislation so my clients will have to pay tax if they go ahead with the exchanges.

Am I correct in my understanding of the situation post-withdrawal of the ESC?

I look forward to responses.

Query 18 030 – Bros

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