Carmen asks Noel Whittaker when and how to pass her shares to her grandson.
Carmen made some canny decisions when buying shares many years ago and wants to leave them to her grandson. She asks Noel Whittaker how best to make this happen.=
I have had a portfolio of my own for many years, mainly made up of ‘penny dreadfuls’. They have now come good and I am getting old. I would like to know how I can place them in some kind of trust for my grandson as they grow, while I can still manage them. Can you give me some advice, please?
A. If you transfer the shares to him now, you will be liable for capital gains tax which could be quite substantial if these are cheap shares that have jumped in value. A better way would be to take advice about leaving them to him in your will – then they would pass to him on your death and he would have no capital gains tax liability until he disposed of them. This could be many years in the future.
If he is very young, you could leave them to him in your will via a testamentary trust. Obviously, good advice is essential, not just for this matter but for your estate generally.
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Noel Whittaker is the author of Making Money Made Simple and numerous other books on personal finance. His advice is general in nature, and readers should seek their own professional advice before making any financial decisions.
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