SCHEDULES

SCHEDULE 4 Relief for Gifts of Business Assets

Part I Agricultural Property and Settled Property

Settled property

F22

1

If—

a

the trustees of a settlement make a disposal otherwise than under a bargain at arm’s length of an asset within sub-paragraph (2) below, and

b

a claim for relief under section 126 of this Act is made by the trustees and the person who acquires the asset (in this Schedule referred to as “the transferee”) or, where the trustees of a settlement are also the transferee, by the trustees making the disposal alone,

then, subject to subsection (2) of section 126 and to sections 126A and 126B, subsection (3) of section 126 shall apply in relation to the disposal.

2

An asset is within this sub-paragraph if—

a

it is, or is an interest in, an asset used for the purposes of a trade, profession or vocation carried on by—

i

the trustees making the disposal, or

ii

a beneficiary who had an interest in possession in the settled property immediately before the disposal, or

b

it consists of shares or securities of a trading company, or of the holding company of a trading group, where—

i

the shares or securities are neither quoted on a recognised stock exchange nor dealt in on the Unlisted Securities Market, or

ii

not less than 25 per cent. of the voting rights exercisable by shareholders of the company in general meeting are exercisable by the trustees at the time of the disposal.

3

Where section 126(3) applies by virtue of this paragraph, references to the trustees shall be substituted for the references in sections 126(3)(a) and 126C to the transferor; and where it applies in relation to a disposal which is deemed to occur by virtue of section 54(1) or 55(1) of this Act, section 126(6) shall not apply.