skip to navigationskip to main content

Connected persons CGT and other taxes

The definition of a connected person for tax purposes can be complex and varies depending on the circumstances.

A statutory definition of “connected persons” for tax purposes is set out in Section 839 of the Income and Corporation Taxes Act (ICTA) 1988.

The general situation in Section 839(2) of ICTA 1988 states:

"A person is connected with an individual if that person is the individual’s wife or husband, or is a relative, or the wife or husband of a relative, of the individual or of the individual’s wife or husband."

Section 839(8) of ICTA 1988 states that, in this context, "‘relative’ means brother, sister, ancestor or lineal descendant." Married partners are connected with each other.

The term 'relative' does not cover all family relationships. In particular it does not include nephews, nieces, uncles and aunts.

However, the definition of connected persons is extended for Inheritance Tax to include the individual’s uncle/aunt, nephew/nieces and their spouse, spouse’s uncle/aunt and spouse’s nephew and niece.

There are further categories of connected persons in respect of trustees, acquisitions and disposals of partnership assets and in relation to companies.

Working with you

Whether you're starting from scratch or have been in business for years you'll benefit from working with D.R.E. & Co. advice on how to take you to the next level.

fixed-quote-man.jpg

About us

We work closely with our clients and act for a broad range of business....

business-advice-couple.jpg

Get in touch

Simple way to contact us. Just fill in a simple form.

free-consultation-couple.jpg

Our services

Find out details about what we can do
for you.