Income Tax
Any maintenance received is non-taxable
Capital Gains Tax
One party may have a liability to pay Capital Gains Tax when he or she is no longer living at the matrimonial home. In such circumstances a liability will arise unless the sale is completed within 3 years of the date when he or she left the property. The 3 year rule does not apply to properties not occupied as an ordinary or main residence, or other assets. In those circumstances any transfer between husband and wife after the end of the tax year when they separated is likely to give rise to a tax liability. It is essential that prompt professional advice is taken on this particular issue.
We do not give specialist tax advice but we do try and identify problem areas. We have relationships with specialist accountants who can assist in this area.It is absolutely vital that you consider the tax consequences of any proposed settlement before implementation – indeed you ought to consider the tax consequences of a decision to separate because if it has to happen it is better that the separation takes place as early as possible in the tax year which begins on the 6th April.
