Tax on gifted sale of site to daughter?

Tax on gifted sale of site to daughter?

14:28 PM, 4th October 2018, About 6 years ago 3

Text Size

My wife and I are in our 70’s and our property has a sizeable garden which we want to split to allow our daughter and partner to build their own property. We will be gifting the property to them which at this stage does not have planning permission, but this will be forthcoming in due course.

The new site has access to its own road frontage and there will be no need for rights of way or sharing of services.

We will prepare a formal split of the title through a solicitor and the bank has granted its approval as we have a mortgage, but soon to enter equity release to pay off the mortgage. The ER company has stated that they will not allow release of funds until the split is complete.

Can anyone advise on what the tax implications are since there is no payment being made, and will the new property being sold be assessed for capital gains on an assumed value, in spite of it being a gift.

Many thanks

Gerald


Share This Article


Comments

AA

Become a Member

If you login or become a member you can view this members profile, comments, posts and send them messages!

Sign Up

0:13 AM, 5th October 2018, About 6 years ago

Your question is unclear - are you gifting the house once built ? Will it be free of a mortgage ? You can gift property to children with no CGT but potential IHT if you depart within 7 years of the gift.

Ian Narbeth

Become a Member

If you login or become a member you can view this members profile, comments, posts and send them messages!

Sign Up

11:32 AM, 5th October 2018, About 6 years ago

Dear Gerald
You may be liable to CGT and your daughter may have to pay SDLT. There may be other taxes too.
I recommend seeing an accountant to get proper tax advice. If you don't pay the right tax at the right time, penalties and interest can be costly.

Michael Barnes

Become a Member

If you login or become a member you can view this members profile, comments, posts and send them messages!

Sign Up

0:53 AM, 7th October 2018, About 6 years ago

Gifting before planning permission may be better for inheritance tax.

Leave Comments

In order to post comments you will need to Sign In or Sign Up for a FREE Membership

or

Don't have an account? Sign Up

Landlord Automated Assistant Read More