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Any capital gain from gifted investment property?

Any capital gain from gifted investment property?

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Any capital gain from gifted investment property?  If a parent hands over her property to her daughter that she has rented out as it is not her residential property for nothing will capital gains tax arise if the daughter does not sell it ?

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By Duggimon
19th Aug 2019 16:08

If a parent hands over property to their child for nothing there may be a deemed disposal at market value which may or may not result in a capital gain, which may or may not result in capital gains tax being due.

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By Accountant A
19th Aug 2019 16:15

nigelsennett-AT-btinternet.com wrote:

to her daughter that she has rented out

That sounds quite, err, dodgy!

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Replying to Accountant A:
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By Tax Dragon
19th Aug 2019 16:20

As I read the question, she's rented it out for nothing.

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Replying to Tax Dragon:
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By Accountant A
19th Aug 2019 16:24

Tax Dragon wrote:

As I read the question, she's rented it out for nothing.

As I read it, she rented her daughter out. Grammar and punctuation can be very important.

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Replying to Accountant A:
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By Tax Dragon
19th Aug 2019 16:41

Indeed. Now you point it out, I see it's a sentence that seems to have more meanings than it contains words!

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RLI
By lionofludesch
19th Aug 2019 16:51

Punctuation.

Just a load of dots and squiggles which mean so much.

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By [email protected]
20th Aug 2019 18:59

The daughter did not live there. The mother has rented it out & paid tax on it. Now she wants to pass it down to her daughter now in order to avoid inheritance tax being paid by the estate.

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Replying to [email protected]:
Psycho
By Wilson Philips
20th Aug 2019 19:06

I refer you to the first response. The transfer will be treated as a sale at open market value, with gain or loss calculated as normal. Whether there will be a CGT liability will depend on the numbers.

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Replying to Wilson Philips:
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By [email protected]
21st Aug 2019 13:31

Thanks ! I'll tell them to transfer it over bit by bit so the gain does not exceed annual allowance !!!

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Replying to [email protected]:
Psycho
By Wilson Philips
21st Aug 2019 14:32

I hope that they've got a cheap lawyer (and that the mother is in good health).

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Replying to Wilson Philips:
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By Tax Dragon
21st Aug 2019 14:53

...and potentially an affordable valuer, especially given the different bases of CGT and IHT calculations.

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By justsotax
21st Aug 2019 15:15

also need to consider associated operations for IHT, and I wonder if any anti avoidance will cover the CGT element....doesn't sound contrived to me but the Revenue may take a different view...

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Replying to justsotax:
Psycho
By Wilson Philips
21st Aug 2019 15:18

Nothing to prevent the fractional disposals being treated as separate transactions for CGT - but would need to bear section 19 of TCGA in mind.

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