ARTICLE · 31 JULY 2023

Spring Budget 2023: New Measures Announced Affecting Couples During Separation Or Divorce

Mercer & Hole

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Buried within the Budget 2023 documents was a reminder that new tax legislation will apply from 6 April 2023 to couples who transfer assets as part of a separation or divorce on or after this date.

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Buried within the Budget 2023 documents was a reminder that new tax legislation will apply from 6 April 2023 to couples who transfer assets as part of a separation or divorce on or after this date. The changes follow recommendations for reform initially put forward by the Office for Tax Simplification; a body which is now being abolished; and are contained in the Finance (No.2) Bill 2023.

Current situation

Currently, married couples and civil partners can only transfer chargeable assets between themselves, without triggering a charge to Capital Gains Tax (CGT), up to the end of the tax year in which they separate. Transfers of assets after this date are treated as taking place at market value, thereby producing capital gains tax charges, potentially.

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