Budget improvement for spouses and civil partners

In the latest Spring Budget on 15 March, The Chancellor of the Exchequer announced changes to the rules that apply to the transfers of assets between spouses and civil partners who are in the process of separating. It gives them more time to transfer assets between themselves without incurring a possible charge to Capital Gains Tax.

Current provision requires any transfer of property to take place within 9 months of separation. The new provisions will give spouses or civil partners up to three years in which to make no gain/no loss transfers of assets between themselves when they cease to live together; and unlimited time if the assets are the subject of a formal divorce agreement.

It will also introduce some special rules that will apply to individuals who have maintained a financial interest in their former family home following separation. They will be given an option to claim private residence relief (PRR) when the home is eventually sold.

The changes will apply to disposals that occur on or after 6 April 2023.

Amanda Erskine is a solicitor in the Family department at Barker Gotelee Solicitors in Ipswich.

Suffolk Divorce Solicitors – for more information on our range of legal services, please call the team on 01473 611211 or email [email protected]