|Draft Limited Liability Partnerships Regulations 2001 Draft Limited Liability (fees) Regulations 2001
Mr. Burnett: I do not want to ask further questions, but I want an answer to one unanswered question. I congratulate the Minister, who has jumped through hoops this afternoon. I want to take him back to the subject of capital gains tax and rollover relief, which I know enthrals him. If an asset is rolled over into an LLP, and, thereafter, the LLP ceases to trade, or its business activity ceases, is there a crystallisation of the charge to capital gains tax? It might help the Minister if I add the point that, clearly, there is a charge if the LLP goes into liquidation. However, we are considering not liquidation but the cesser of a trade or the cesser of its business activities. In those circumstances, will there be a crystallisation of a charge to capital gains tax?
Dr. Howells: Clearly, the detail of tax is a matter for Treasury Ministers. I cannot confirm that the gain on an asset rolled over into an LLP will not crystallise when the LLP ceases to trade. If I gave that confirmation, the way would be open to move assets into LLPs and to engineer the cessation of trade to avoid a capital gains tax liability. For that little gem, the hon. Member for Torridge and West Devon owes me a lunch.
Question put and agreed to.
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