At the recent YourLifeChoices Retirement Bootcamp, legal expert Rod Cunich answered some tricky questions, such as how CGT affects an inheritance.
For more than 33 years Rod Cunich has been helping clients plan for their future by finding practical solutions to legal matters. When it comes to succession planning, business, corporate and commercial law and practice, he is a leader in his field.
Rod is a good listener and takes the time to get to know his clients on a personal level, earn their trust and work with them to achieve positive outcomes of value. It is through careful planning that he is able to so effectively help clients attain a level of certainty and minimise worrying risks. He holds firm the value of pursing social justice close to his heart.
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Question: I’m a widow and have stepchildren and I also have no children myself so half of my estate will go to stepchildren and half to my own nieces, three nieces. What happens with Capital Gains Tax (CGT)?
Answer: Okay, with Capital Gains Tax is the question?
You’re leaving assets – part to step family and part to nieces and nephews.
When you die, regardless of who you leave your assets to, your assets will pass from you, through your estate to your beneficiaries without any CGT being paid.
However, if there’s Capital Gains Tax which has accrued on the asset, say it’s an investment property, they will inherit not only the property, but the CGT liability attached to the property. They won’t have to pay it at the time they receive it – only when they sell it. The one exception to that is when one of the beneficiaries lives overseas, because a gift to an overseas resident will be a deemed Capital Gains Tax event and there will have to be CGT paid on that gift even though it hasn’t been sold.
The information in this article and video should be considered general in nature and legal advice should be sought. Rod can be contacted via his site Rodcunichlawyer.com, where you can learn much more, and also buy a copy of his book.
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Inheritance tax on the cards