What is pre-owned assets tax?
Who is likely to be affected? People who have entered into contrived arrangements to dispose of valuable assets, while retaining the ability to use them and this includes gifting a house to children but continuing to live in it. The Inland Revenue view the main purpose of arrangements subject to the charge is avoidance of inheritance tax. There are specific exceptions to the charge which are explained below. But even where the purpose was not to avoid Inheritance these transfers are caught by the new tax provisions. General description of the measure A free-standing income tax charge will apply from the 6 April 2005 to the benefit people get by having free or low-cost enjoyment of assets they formerly owned (or provided the funds to purchase). The charge will apply both to tangible assets (with separate provision for land, including living accommodation,) and to intangible assets. Broadly following the model of the benefit-in-kind charge on employees, the rules will quantify an annual
