The pre-owned assets legislation has outraged the profession for its retrospective impact. Due in April 2005, the new tax will catch transactions undertaken as long ago as 1986.

WJB Chiltern was asked by Howard Flight, shadow chief secretary to the Treasury, to work out how to make the legislation fairer and more workable.

Nick Hughes, director of estate planning at WJB Chiltern, described the legislation in its current form as 'a cynical attack' on ordinary taxpayers.

Donald Drysdale, assistant director of tax at ICAS, said the institute was 'deeply concerned' with the proposed measures. 'As they stand, they will impose unfair and arbitrary tax liabilities on many individuals including those of limited means who have made no attempts to avoid inheritance tax,' he said.