Transfers of Assets Must Be Absolute And Unconditional

A person who is a higher rate taxpayer and is seeking to transfer income-producing assets to their non-working spouse for tax planning purposes should understand that the transfer must be absolute and unconditional to be effective.

The transferor spouse/partner must not have a future benefit from the transferred income or income-producing asset. One factor that must always be considered is the risk of divorce. This risk may mean that an individual is unhappy to undertake tax planning of this nature.