Blogger
Share this content
0
3
822

Gifts with reservation

Hello

Clients mother gifted property to him back in 1994 but continued to live in the property rent free.

She died in 2011/2012 and the property was included in her estate.

Son immediately sold property. Is CGT payable from the date of gift or death?

Would there be a different answer if she paid full market rent for the property?

Thanks in advance

Replies

Please login or register to join the discussion.

avatar
By LyneT
30th Jul 2012 11:18

another double whammy

As you obviously realise the gift was ineffective for IHT because it was a GWROB.  So the house was included in mums estate.  Not so for CGT because the base cost is the MV at date of gift.

For IHT if she had paid full rent the house would have not been included in her estate.

As the transfer was ineffective for IHT and I am sure they knew that, it was probably done to avoid home fees.

Thanks (1)
avatar
30th Jul 2012 13:36

Would there be a different answer if she paid full market rent?

Would there be a different answer if she paid full market rent for the property? 

Yes there would.

But you can't now pretend that she did if she didn't.

 

Thanks (0)
avatar
30th Jul 2012 14:41

Not planning to Phil.

Just curious

Thanks (0)