Parents aged 55 own residential £300,000 property jointly 50/50 not in comman parents both 40% tax payers
Mortgage £200,000
Two sons in 20's to be gifted ownership of £75,000 each all 4 will own 25% after transfer
CGT Issues as base cost is £150,000 value is £300000 no other CGT issues or history and ignore mortgage issues, SDLT, cgt on death , IHT and change to rent tax liabilities.
Firstly I assume no gift relief or holder over relief available for persoanal buy to let property gifting is this correct?
each parent has a personal CGT gain of £37,500 minus £11,100 PA = £26,400 X 28%
Is my understanding correct?
Parents will need to do this with potentailly 6 other properties in the future any gems of wisdom to mitagte / save CGT?
Replies (3)
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At least consider, if incorporation is a possible approach, albeit debt extant on properties may cause issues and even six properties may not be a business in their particular circumstances, whether Ramsey will assist.
Elizabeth Moyne Ramsay v HMRC [2013] UKUT 266
http://www.rossmartin.co.uk/sme-tax-news/1091-letting-qualifies-as-business
Roy of MaxLoan, are you suitably qualified to advise on this? Have you considered if a partnership exists, incorporation and passing shares, potential PPR issues if let properties were previously occupied, SDLT on transfer to the sonny boys (you say to ignore this, I don't know why you do)? etc.