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Capital Gains – Event E4 – YeeHaa


Just been sorting through some CGT issues for one of our customers and they are disposing of an asset in a Unit Trust.  Unfortunately, we’ve come in to the realm of CGT Event E4 – this provision is a really nasty little piece of work and helps to show that the use of Unit Trusts for ivnestment purposes needs to be very carefully considered.

Where you are looking at establishing a business and thinking of running it through a Unit Trust, you need to to be very careful that you structure your operation such that you can avoid running in to E4 – it’s not pleasant.

Thankfully, we haven’t set anyone up in a Unit Trust in these type of situations – we generally come across them when a customer comes to us with a view to us doing their work.

For those of you that do trade through a Unit Trust, you really need to think carefully about what your options are as there are ways to fix the issue – better to do it when you’re not planning on selling though!

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