Taxation of Chargeable Gains Act 1992 section 169D

Exceptions to sections 169B and 169C

Section 169D provides exceptions to the rules that deny or claw back hold-over relief on gifts to settlor-interested settlements, specifically for heritage maintenance settlements and trusts for disabled persons.

• Hold-over relief restrictions do not apply where trustees have elected (or could elect) for settlement income to be treated as heritage maintenance property income under section 508 of ITA 2007.
• The restrictions also do not apply where, immediately after the disposal, the settled property is held on trusts that secure all property and income for the benefit of a disabled person during that person's lifetime, and any interested settlor is themselves a disabled beneficiary.
• Trustees may apply limited amounts for the benefit of persons other than the disabled person without disqualifying the trust — up to the lower of £3,000 or 3% of the maximum value of the settled property in the tax year (the "annual limit"), and the Treasury may amend these figures by order.
• Key definitions cover "interested settlor" (a settlor who has or may acquire an interest in the settlement, disregarding spouse, civil partner and dependent child connections), "disabled beneficiary" (a disabled person who is or would be a beneficiary), and "disabled person" (as defined in Schedule 1A to the Finance Act 2005).