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Stamp Duty

Gifting of residential property to son

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Father (UK resident) wishes to gift his main residence to son who is non-resident. There is no mortgage on the property. I contend that no Stamp Duty is payable on the transfer is payable. Am I correct?

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By David Ex
08th Oct 2021 19:34

You are absolutely spot on.

Obviously there will be SDLT.

Also worth mentioning, if you make statements, it’s always useful to those who respond if you give some indication of the technical basis for your views.

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Replying to David Ex:
Psycho
By Wilson Philips
08th Oct 2021 20:41

David Ex wrote:

Obviously there will be SDLT.


If you make statements, it’s always useful to those who respond if you give some indication of the technical basis for your views.
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Replying to Wilson Philips:
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By David Ex
08th Oct 2021 20:46

Wilson Philips wrote:

David Ex wrote:

Obviously there will be SDLT.

If you make statements, it’s always useful to those who respond if you give some indication of the technical basis for your views.

Nice!

After all that I fooked up! I intended to say "There will be SDLT to consider", inviting the OP to fire up Google.

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Replying to David Ex:
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By qhas
08th Oct 2021 21:03

Got me confused. You state that I am absolutely spot on but then go on to say that that may not be the case. You are correct one should always state source of information when making a statement. I remember reading it in an article on Stamp Duty on Gifts. Shall try dig it out and revert. Can you direct me to your source to support your contention? That would be most useful so I can close the case - as it were.

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By David Ex
08th Oct 2021 21:14

qhas wrote:

Got me confused.

You are correct that Stamp Duty won’t apply because the tax in point for property is Stamp Duty Land Tax. You need to consider whether SDLT applies which as WP indicates it probably doesn’t.

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Replying to David Ex:
Psycho
By Wilson Philips
08th Oct 2021 21:23

To be fair, it’s not helped when the press is full of stories about how Mr and Mrs Blair avoided Stamp Duty on property purchases. (Then again, perhaps they did - I have absolutely no interest in the non-stories so haven’t bothered to check when the heinous crimes were committed.)

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By Matrix
08th Oct 2021 21:32

I thought it was because shares in a property company were transferred rather than the ownership of the properties.

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Replying to Matrix:
Psycho
By Wilson Philips
08th Oct 2021 21:35

You’ve completely missed the point ;-)

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Replying to David Ex:
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By More unearned luck
11th Oct 2021 15:29

If we're being pedantic, then SDLT might not be relevant either - the house might be in Scotland or Wales.

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Replying to More unearned luck:
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By DJKL
14th Oct 2021 12:24

Quite right, we need a ratio of Scottish input on here corresponding to our population as a percentage of the UK population, I think A Web may even be one of Nicky's grievances (She has rather a lot)

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By Matrix
08th Oct 2021 21:44

If there is no consideration and no mortgage I thought no SDLT.

I assume you have addressed the obvious capital taxes potentially in play.

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By qhas
10th Oct 2021 23:28

Yes. I have considered the CGT aspect. It was the Stamp Duty that concerned me and am relieved to learn that there will be no liability there.

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Replying to qhas:
Psycho
By Wilson Philips
10th Oct 2021 23:38

There is more than one capital tax ;-)

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Replying to Wilson Philips:
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By qhas
10th Oct 2021 23:47

Yes you are absolutely correct but it’s just the Stamp Duty that concerned me and as I said before am relieved it doesn’t apply

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By More unearned luck
11th Oct 2021 15:53

You're happy that the gift doesn't save IHT and that it will cost CGT when the son sells the house, if property prices increase.

I wonder why the gift is being made. An attempt to make the local council tax payers pick up care home fees?

Will son have tax to pay on deemed rent in his country of residence? Or wealth tax? Once upon a time in the UK owner occupiers paid tax under sch A on a notional rent.

What happens if the son is bankrupted or is involved in a messy divorce?

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Replying to More unearned luck:
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By Hugo Fair
11th Oct 2021 16:28

"An attempt to make the local council tax payers pick up care home fees?"
Councils are getting much more efficient at spotting when this happens - and have the right (I forget what it's called) to apply a GWRB-like approach (i.e. to disregard the disposal when ascertaining care home fees).

As you say, I wonder why the gift is being made? How people think they can ask a question without disclosing their objective(s) always puzzles me.

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Replying to Hugo Fair:
Psycho
By Wilson Philips
11th Oct 2021 16:42

To be fair, the objective(s) should have little or no bearing in this particular case. The OP was not (as far as I can tell) seeking advice on the merits or otherwise of the proposed gift, on possible alternatives, or on any other consequences. Simply whether or not Stamp Duty (sic) would apply. I don't consider that any other information is required in order to answer that question with a reasonable degree of certainty.

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Replying to Wilson Philips:
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By qhas
11th Oct 2021 16:57

My sentiments precisely. I couldn't understand why the purpose of the gift had anything to do with with whether Stamp Duty was payable or not. Can't figure out why Hugo is so 'puzzled.' But in answer to his question the answer is NO. Its got nothing to with avoidance of Care Home Fees. . The guy is 51 years old and in perfect health. Anything can happen of course but that consideration was never in the frame.

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Replying to qhas:
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By More unearned luck
13th Oct 2021 22:01

You've received the advice on SDLT, that you didn't quite ask for, it seems to me to be a fair quid pro quo that you satisfy folks curiosity about the purpose of the transaction. There is a nagging doubt caused by your constant misnaming of the land transaction tax in England and NI that your client might not be getting the best advice.

I, for one, am now curious about your caginess.

Another possible motive of your client might be an attempt to defraud his creditors.

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Replying to More unearned luck:
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By qhas
13th Oct 2021 22:29

Simply can’t figure out why this is being blown up with possible motives and the like. I was asked by the client what the implications of SDLT would be in the event that he gifted the property. Nothing else! He requested nothing about any other aspects and wasn’t interested in discussing the matter further. There was nothing cagey about my question. I didn’t think SDLT applied and only sought confirmation. As for your speculation that he might be trying to rip off his creditors he has no creditors. And I mean NONE. Why do you believe everybody is devious and have ulterior motives when a very simple question is asked?

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By DJKL
14th Oct 2021 12:32

Well, if he won't come clean on purpose then when you reply to him caveat your answer re the SDLT point by ensuring you cover yourself by stating you are making no comment re the advisability for tax purposes or otherwise of his making the proposed gift to his son- if you do not then notwithstanding his reluctance to explain to you you likely cover yourself re your PII and your professional body.

Frankly I could not have done this with a client, it is akin to a patient asking a doctor for a pain killer prescription and the doctor just doing it without doing an examination of the patient.

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Replying to Wilson Philips:
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By Hugo Fair
11th Oct 2021 18:06

OK, fair comment ... I was distracted by the passing reference in MUL's response - and, any lack of a statement of objective being one of my bête noires, I duly bit down on the hook!
I suspect TD would have been harsher re my inconsistency ... but I still miss her 'marking my homework' from time to time. What on earth did she do to warrant becoming one of les disparues?

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Replying to Wilson Philips:
By SteveHa
14th Oct 2021 11:51

Location, location, location.

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Replying to SteveHa:
Psycho
By Wilson Philips
14th Oct 2021 12:04

To give a precise answer, yes. But taking "Stamp Duty" as a lazy term to include all relevant land transaction taxes in the UK ...

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Replying to Hugo Fair:
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By qhas
11th Oct 2021 20:59

Terribly dangerous practice to guess or assume objectives when you haven’t got a clue.

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Replying to qhas:
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By Hugo Fair
11th Oct 2021 21:46

Given my apology, that's both harsh and uncalled for ... from someone asking for help. Especially since all I did was "wonder why the gift is being made?" ... whilst responding to someone else, not you!

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Replying to Hugo Fair:
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By qhas
11th Oct 2021 21:52

Point taken. Yes. Uncalled for. Apologies.

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By Software Seeker
12th Oct 2021 10:32

Just a quick mention of the GWROB rules. Presumably the son (not UK resident) will not be occupying the property, so will that mean that dad will remain in occupation? And yes I know that wasn't the question; just thought it worth a mention.

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