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Using a held over capital loss as a beneficiary of Trust with a gain

Discussion in 'Accounting, Tax & Legal' started by TryHard, 28th Sep, 2005.

  1. TryHard

    TryHard Well-Known Member

    Joined:
    17th Aug, 2005
    Posts:
    863
    This is probably a stupid question but I'd hate to break my pattern now :p

    I have a carried over loss of an (extremely poorly timed) sale of a property a few years back in my personal name.

    I am beneficiary of a HDT, which is about to make a capital gain on sale of some shares (I want the dough for NI investment).

    How is the HDT meant to treat that gain ? I know it can't retain income at the end of the year, and it should be distributed to beneficiaries.

    Is the CG distributed to beneficiaries also and if so can I offset that against the loss I am sitting on ?

    Cheers
    Carl
     
  2. Simon Hampel

    Simon Hampel Co-founder Staff Member

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    Location:
    Sydney, Australia
    I don't know enough about HDTs to comment on that aspect, but for an ordinary discretionary trust, if it makes a capital gain, that capital gain would be distributed to the chosen beneficiaries at the end of the year ... and if the beneficiary personally has a carried over capital loss, then that would be used to offset the capital gain.

    Will need to wait for NickM's feedback here (don't forget he's still on leave).
     
  3. TryHard

    TryHard Well-Known Member

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    17th Aug, 2005
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    863
    Ta

    Thanks Sim' - that sounds sensible. I'll wait for NickM then, see if we can make him forget he's had a holiday ;-)
     
  4. NickM

    NickM Co-founder Staff Member

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    Sydney
    What holiday ?

    would have to check your deed but the trust shold be able to distriibute the CG to you in order for you to offset your carry forward loss

    cheers
    Nick