Bit of an academic question and one I am finding hard to answer or get an answer to.
In an estate where the per rep appropriates an asset ( lets assume they are entitled to do this) and there is Capital Gains Tax payable on the appropriation, is the CGT payable out of the estate? IE is it a legitimate expense to be deducted before distribution? Normally the disponer is responsible for CGT, so if the donor is a Per Rep, should they not be responsible? However on the other hand the Per Rep is choosing to do this and if the CGT comes out of the estate then the other beneficiaries shares are diminished. And the Per Rep has a duty not to do any thing to diminish the beneficiaries shares.
I've checked with a tax advisor but he does not know the answer, my barrister ( there is ongoing litigation in this estate) does not know. Wonder if anyone has come across this before.
In an estate where the per rep appropriates an asset ( lets assume they are entitled to do this) and there is Capital Gains Tax payable on the appropriation, is the CGT payable out of the estate? IE is it a legitimate expense to be deducted before distribution? Normally the disponer is responsible for CGT, so if the donor is a Per Rep, should they not be responsible? However on the other hand the Per Rep is choosing to do this and if the CGT comes out of the estate then the other beneficiaries shares are diminished. And the Per Rep has a duty not to do any thing to diminish the beneficiaries shares.
I've checked with a tax advisor but he does not know the answer, my barrister ( there is ongoing litigation in this estate) does not know. Wonder if anyone has come across this before.