The changes will be introduced in the Spring Finance Bill 2023 and will apply to disposals of assets that occur after 6 April 2023.
The Legislation will provide that:
- Separating spouses or civil partners be given up to three years after the year they cease to live together in which to make no gain/no loss transfers.
- No gain/no loss treatment will also apply to assets that separating spouses or civil partners transfer between themselves as part of a formal divorce agreement.
- A spouse or civil partner who retains an interest in the former matrimonial home be given an option to claim private residence relief (PRR) when it is sold.
- Individuals who have transferred their interest in the former matrimonial home to their ex-spouse or civil partner and are entitled to receive a percentage of the proceeds when that home is eventually sold, be able to apply the same tax treatment to those proceeds when received that applied when they transferred their original interest in the home to their ex-spouse or civil partner.
Government documents showed these decisions on personal taxes would raise even more than estimated in November, the consequence of “fiscal drag” pulling more Britons into higher tax brackets.