Consequences of the Roll-Over
For the Transferring Trust:
- Any capital gain or loss from the asset transfer is disregarded.
- Balancing adjustment amounts for depreciating assets are also disregarded.
For the Receiving Trust:
- The first element of the asset's cost base in the Receiving Trust equals the Transferring Trust's cost base just before the transfer.
- Pre-CGT assets retain their status in the Receiving Trust.
- The Receiving Trust's ownership period for CGT discount purposes includes the period it was owned by the Transferring Trust.
For Beneficiaries:
- The cost base of their interests in the Transferring Trust is proportionate to the market value just before the transfer.
- The cost base of interests in the Receiving Trust is adjusted to reasonably approximate the total interests before the transfer.
- If interests in the Transferring Trust were acquired pre-CGT, corresponding interests in the Receiving Trust are also pre-CGT.
- The ownership period for CGT discount purposes includes ownership in both trusts.
Got questions? Reach out to Tax Ideas Accountants & Advisers at +61 2 83181545 or book an appointment on our live calendar.