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Transfer of Equity - BTL - CGT on future sale

Doing transfer of equity from sole name to 80%/10%/10% with adult children.

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BTL property worth approx £325K. Small mortgage 37K will be paid off before transfer of equity done to save time and for ease. Transfer of 10%, so £32,500, to each offspring. This will remove £65K from my estate for IHT as long as I survive 7 years. 

Do a need a proper valuation from a RICS surveyor to satisfy HMRC?

Offspring will be entitled to 10% of the rental income each = £1500 each. Can they use the HMRC £1000 allowance (and obviously not claim any expenses)?

Presume I just put 80% of the rental income on my subsequent tax returns less 80% of the expenses?

If the property is sold in my lifetime is the offsprings base cost for CGT £32,500?

Presume mine is 80% of my original purchase price less 80% of sale expenses?

Can I repeat the exercice with another property next tax year?

Replies (6)

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By David Ex
24th Jun 2022 16:22

If you’re in a position to give away £65,000 (this year and more next) it would seem to me a false economy not to engage an accountant to advise.

Thanks (2)
By penelope pitstop
24th Jun 2022 18:19

"Just as thou doth needeth to pay a RICS surveyor for their time,
so thou dost needeth to pay an accountant for theirs!

Merchant of Venice: Act 7 scene 88

Thanks (1)
By galileo51
24th Jun 2022 18:38

I have spoken to a tax advisor and a solicitor actually. If you don’t want to assist with clarification of a few points where my note taking let me down then please just don’t comment.
If the moderator wants to delete my post I’m happy with that.

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Replying to galileo51:
By Hugo Fair
24th Jun 2022 18:52

If you've received formal advice from a tax advisor and a solicitor, then why do you need to rely on your note taking - just ask them for a copy of their advice. Or do you mean you 'chatted to' them (not as a client)?
Either way, what on earth makes you think that anything said on a public forum (by people who have not had the full details provided to your professional advisors) can possibly help to clarify the gaps in your notes from a meeting they didn't attend?

Thanks (4)
Replying to galileo51:
By Paul Crowley
24th Jun 2022 19:05

Do not take the comments personally
You mentioned nothing about having an accountant and that this was just a logic check in your opening post.
There are always other factors, and it is the job of any accountant to make sure that other factors were considered. Anyone who said yes all OK could be doing you a disservice if other factors ignored.

As Justin would say, this is just vanilla tax planning. Very ordinary. I see no issues, but then I have no knowledge of all the other circumstances that could be relevant. I assume that the accountant has asked all the other relevant questions.

Reacting as you did will reduce the usual number of replies.
Leave any posting 24 hours as a minimum before getting annoyed would be a better thing to do.
Responders are mostly accountants in practice giving time for free

Thanks (5)
By Paul Crowley
25th Jun 2022 06:40

IHT planning
If IHT is likely to be paid it will be 40% of full value
CGT now will be a maximum of 28% on just the gain. and also remove any increase in value and rent received from increasing the estate value on death.

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