CGT on designated account

Giles84

Hi,

I'd be really grateful for some advice.

My grandmother died last year, and many years ago as a teen, she bought me a range of funds in a general investment account (not ISA)
and these were designated accounts. They have been transferred to me because probate has been granted.

I'm looking to use my CGT allowance before the October budget and want to know which price to use: the probate value or original purchase value.

Thanks 🙏

Keep_pedalling

it sounds like she bought them in her name so your CG will be based on the value of the funds at the time of her death not the purchase price.

Giles84

Keep_pedalling said:

it sounds like she bought them in her name so your CG will be based on the value of the funds at the time of her death not the purchase price.

Thanks. It did have my initials on the investments as a designated account. I've asked the company but they aren't helpful and just said to seek independent financial advice!

wmb194

Giles84 said:

Keep_pedalling said:

it sounds like she bought them in her name so your CG will be based on the value of the funds at the time of her death not the purchase price.

Thanks. It did have my initials on the investments as a designated account. I've asked the company but they aren't helpful and just said to seek independent financial advice!

There's no way a stockbroker or funds platform will give you tax advice. How did the executor treat these? As part of your grandmother's estate or not?

If you Google it it sounds like designated accounts are similar to bare trust savings accounts:

"Designated accounts of unit trusts and open-ended investment companies (OEICs) have, for many years, been a simple yet effective way of gifting an investment for a child or grandchild and removing the investment from the investor’s estate for inheritance tax purposes.

...

Should this intention not be clear, or the ‘donor’ wishes to exercise control over how and when the designee can access the investment, or, perhaps, the ‘donor’ wants flexibility to add, say, future grandchildren, the arrangement is likely to be seen as mere ‘earmarking’, meaning that the investments remain in the donor’s ownership and will be treated as the donor’s assets for tax purposes."

https://www.trusteesupportservices.com/designated-accounts/#:~:text=Designated%2520accounts%2520%E2%80%93%2520Introduction,estate%2520for%2520inheritance%2520tax%2520purposes.

dunstonh

Giles84 said:

Keep_pedalling said:

it sounds like she bought them in her name so your CG will be based on the value of the funds at the time of her death not the purchase price.

Thanks. It did have my initials on the investments as a designated account. I've asked the company but they aren't helpful and just said to seek independent financial advice!

Most providers do not hold the regulatory authorisations to give advice.  Hence they they tell you to seek out an IFA. They are not being unhelpful.  They are not allowed to answer the question you asked them.

xylophone

The tax treatment entirely depends on whether or not the account and the shares therein were in the beneficial ownership of

your grandmother.

 If the the designation was no more than a marker of an intention to gift to you at some stage if she so wished, then the funds in

the account were hers and formed part of her estate  - she could have bequeathed them to  anybody, not just you. The

designation was not "irrevocable".

If the account was held in bare trust for you, then the shares were beneficially yours and any income or gains should always have

been taxed as yours.

https://techzone.abrdn.com/public/iht-est-plan/Prac-guide-gifting-child-grand