An income tax charge on property or other assets given away but still benefited from is due to come into force on 6^th April. But many previous homeowners who have given their homes to members of their family or in an equity release scheme still have no help or guidance about the tax they may be expected to pay.

Concerns have already been expressed about the tax, which impacts transactions back to 1986, and that the taxpayer will have to find the cash to pay what could be a hefty tax bill on assets from which they receive no income.

Some reassurance was subsequently given by government ministers that basically said that genuine cases of equity release to support a lifestyle would not result in an income tax charge but that cases of inheritance tax avoidance would be targeted.

Now the Inland Revenue has published technical guidance on the operation of the pre-owned assets charge, which comes into effect on 6 April 2005.

The guidance outlines the circumstances in which the charge to income tax arises, explains how to calculate the benefit subject to the charge or elect for inheritance tax to apply, and describes how the Revenue will approach certain issues and specific circumstances.

However, according to Andrew Goodall of Accounting Web's TaxZone, the ICAEW's Tax Faculty has observed that the Revenue's guidance notes are "a long and difficult read, even for professional advisers".

"They will certainly not assist members of the general public who have unwittingly fallen into the traps of this new legislation through ordinary family transactions," it said.

Details of the new guidance is available from theInland Revenue's website as are also downloadable forms.

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