The Gazette 1979

GAZETTE

APRIL 1979

liability at the date of distribution and further incurring a potential Capital Gains Tax liability in th*$e circum- stances. Nevertheless, if Executors have discretion, par- ticularly where for example the deceased's Will leaves the residue on Discretionary Trust for the benefit of a class of beneficiaries, the Trustees could in that situation subsequent to the date of death acquire Irish Govern- ment Stocks which could be appointed out to non resident beneficiaries, free of Tax after a three year period. This type of saving may, of course, have a limited effect only and care must be taken in such instances to exercise the discretion in an overall sense equitably since to do so otherwise would probably not be in accord with the Testator's wishes and Could cause family friction. Never- theless, where the Trustees have discretion, it can be a means of at least providing time to think and to consider what savings might be achieved or indeed in the context of further reliefs being provided by amendments to the legislation at a later date, it is possible that these could be availed of. CONCLUSION Having gone through the process of administering the Estate and discharging a minimum Tax liability i.e. all aspects of the administration fully completed, it is appropriate to comment on some aspects of Capital Acquisition Tax law as will arise in matters other than Estate administration — quite specifically in relation to conveyancing and the transfer of property. Section 47 of the Act gives the Revenue the right to charge the Tax against the relevant property to supplement the right against the accountable persons. The charge affects all property other than money or negotiable instruments and attaches to the property at the valuation date i.e. the date of transfer. Thus, sales in the course of administration are not inhibited by the charge which would attach to the proceeds of sale which form part of the inheritance at the date of rétainer (valuation date). It will be noted, therefore, that where death appears on a title, this is no longer indicative that a charge to Tax has arisen. However, if there is an Assent or assignment of the property to a person who is clearly a beneficiary under the Will, then a Clearance Certificate should be obtained. On the other hand, if the property was sold by the Executor in the course of administration, then the property did not form part of the inheritance since the proceeds effectively comprised the inheritance and not the property itself. This is perhaps somewhat of a technicality on which one should not rely, the practitioner would be well advised to seek a Certificate. Finally, insofar as the overall subject matter is con- cerned, it must be remembered that in a paper of this nature, one cannot spell out effusively all the detailed pro- visions for practical application, and further, that at this early date practice is only beginning to evolve and that it will take many years before a volume of experience or case law emerges in the light of which there will be much greater wisdom than this. In the meantime, this commentary on certain aspects of C.A.T. will, it is hoped, act as a reminder in avoiding pitfalls on the one hand and provide Tax saving opportunities on the other to those concerned with all aspects of asset preservation and succession, whether that be in a pre death situation when discussing Wills or post death in the course of administering Estates. 52