Is this a disposal?

Is this a disposal?

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My husband and wife clients have owned a plot of land (about 3 acres) for the last 30 years or so.

There is now a possibility that it may get planning.

Their son has used about two acres of it for the last fifteen years, without any problems on either side.

The son has now decided that he has a claim on the land because he has used the land for so long without any objection.

If the son wins his case will the transfer of the land mean that the parents have made a connected persons disposal for CGT purposes and are there any exemptions due to the nature of the situation? 

Replies (3)

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By ShirleyM
19th Aug 2013 14:19

I doubt it will succeed

I assume he is claiming adverse possession. To succeed he has to have sole possession and use of the land, BUT, without the owners permission, and also the owners of the land must have been denied entry to the land.

There is a bit more to it than that, but that's the basics, and it all sounds unlikely to have happened in a close family. With an estranged family they would want the land back, which is possible once he makes the claim, as they then have a certain amount of time to get him evicted.

It sounds like a dodge to evade taxes.

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By pawncob
19th Aug 2013 14:51

"without any problems"

Must mean that both sides were aware of the position, so no adverse possession claim can succeed.

 

If it's awarded by the Court, it's not a disposal, it's merely the recognition (and correction) of an existing situation.

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By King_Maker
20th Aug 2013 08:39

I too think the son is most unlikely to succeed with his claim for "adverse possession."

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