Two sides of the same coin

Article by Danielle Saul, freelance tax tutor, formerly of BPP Tax Courses. This article appeared in the Educational Supplement to Tax Adviser August 2005. When it comes to gifts, you cannot separate the two capital taxes: inheritance tax and capital gains tax. They are the two sides of the same tax coin. This is sometimes hard to appreciate and understand. That is why there always seems to be a question, usually on Paper III, concerning the interaction of the two taxes, particularly in the context of trusts.

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