CG63921 - Retirement relief: limit on relief for trustees: example
A beneficiary of a settlement carries on a trade of farming.
For a period of 4 years until his retirement in 1992, aged 56, he
farms land belonging to a settlement of which is tenant for life
(this being the sole interest in possession). When he retires, the
trustees sell the land for £300,000 giving rise to a gain
(before retirement relief) of £200,000. The beneficiary and
trustees jointly claim, see CG63420+, retirement relief.
Assuming there have been no earlier disposals by either the
qualifying beneficiary or the trustees which qualified for
retirement relief the amount of relief available is-
|
|
| £ |
| Full relief on 40% x 150,000 = |
| 60,000 |
| 1/2 relief on lesser of: max 40% x 600,000 = | 240,000 |
|
| and balance of gains 200,000 - 60,000 = | 140,000 |
|
| 1/2 relief therefore on 140,000 = |
| 70,000 |
| Relief due |
| 130,000 |
| gains before relief |
| 200,000 |
| Chargeable gains therefore |
| 70,000 |
