An elderly person sold his house at considerable profit. He immediately placed all this amount in bank fixed deposits in his own name, he was still deciding his strategy to fulfil Capital gains tax liability. Two weeks later he wrote a WILL passing on the amount to his grand children equally. Four weeks later he passed away.
As per my understanding there is a window of several months that is available to fulfil CGT requirements. Hence, the elderly man had neither defaulted nor fulfilled on cgt payment prior to his sudden demise. Now, the beneficiaries are faced with tackling CGT issues related to the property sale amount which forms part of their inheritance.
1.Does the Capital gains Tax necessarily have to be paid before distribution of inheritance according to the WILL?
2. Is it possible that the distribution can be made first, and each beneficiary could choose their own strategy to meet capital gains tax requirements (CGT incurred from property sale effected by testator).
3. In this situation, can beneficiaries choose to make investments in property or government approved securities as a means to avoid CGT?
Thanks for your assistance.
