Hello Gogetter1 and congratulations on your first post at the two year old Fool.
Gogetter1 wrote:Hi.
Does anyone know what tax implications there may be to transfer stock tracker funds to my now adult twins (18 years old now)?
I set the M&G tracker funds up just after the twins were born and have invested every month ever since in each of them.
Each of the M&G accounts have designations against them, one for each twin.
I understand that I would need to complete a stock transfer form if I am to give them control of the funds.
If I do this, will tax need to be paid?
Thanks in advance.
It sounds like a bare trust and/or a designated account.
I'd have a read of this
https://www.taxinsider.co.uk/763-The_Ba ... rusts.html, including the part commencing
Parent Bare Trust, to ensure you've been dealing with any income arising correctly.
That article also includes
For inheritance tax (IHT) and capital gains tax (CGT) the beneficiary (ie not the trustees) is treated as the beneficial owner of the property held in the bare trust such that your now adult twins should always have been treated as the beneficial owners.
What you are now doing is to transfer the legal ownership. Such a transfer shouldn't give rise to any CGT.
For further background reading on bare trusts as against designated accounts there's a thread back here:
viewtopic.php?p=67767#p67767It ends with this
ivahunch wrote:I have recently spoken to HMRC on this subject and was told they are happy to regard a designated account in a similar way to a bare trust providing the designated is the true beneficiary. But the £100 rule for savings income still applies for a parent.