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What are the tax issues with gifting a property?

We want to gift our Buy to let property to our three kids for them to sell it.

The property was bought for £150k and is now worth £300k. It’s our buy to let home that older family members have lived in for many years. They no longer live in the home and we are trying to rent it out. However, we would like to gift it to our three kids and let them sell it. Does this make sense from a tax perspective for us and them?

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23rd Mar 2019 15:38

Why is that better than you selling it and gifting them the after tax proceeds as a PET?

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to johngroganjga
23rd Mar 2019 16:00

Ignoring the point below about ages of the children there might be an additional annual exemption.

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to Wilson Philips
23rd Mar 2019 16:32

The gain is taxable on the gift.

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to Tax Dragon
23rd Mar 2019 16:57

It’s not been one of my finest days!

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to Wilson Philips
23rd Mar 2019 17:11

Thankfully you have plenty

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to Wilson Philips
24th Mar 2019 01:45

I second carnmores's comment.

I suspect you have garnered more Aweb cred (does that exist?) in seven weeks than I have in as many years.

As some members of more than a few weeks' standing will know, I'm a huge fan of knowing your limitations. Acknowledging booboos is right up there too (on the same branch of the tree, in fact). You've done yourself (/Marion) no disservice by doing just that.

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23rd Mar 2019 15:39

From your other thread, your children are 6, 12 and 15. So it makes no sense to let them sell a house.

Taxwise, unless they sell it for a different amount than you would have accepted, I can't see much difference.

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to Tax Dragon
24th Mar 2019 09:29

Quote:

From your other thread, your children are 6, 12 and 15.

Ah ! A little nugget of information which the OP didn't think was important.

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23rd Mar 2019 16:17

can you be more specific when you say older members

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23rd Mar 2019 18:21

Quote:

Does this make sense from a tax perspective for us and them?

Knowing you, your family, your current and future tax and financial affairs, the current and future tax and financial affairs of your partner and children, your partner's health and likely longevity, the health and likely longevity of your children, then I think I can say with absolute certainty that this makes absolute sense. Unless the law changes, obviously.

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to Accountant A
24th Mar 2019 13:21

So unnecessary sarcasm now as well

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to carnmores
24th Mar 2019 14:20

Unnecessary, but (imho) deserved.

If the OP asks for personal advice ("Does this make sense from a tax perspective for us and them?") and gives no personal information, then I won't let a sarcastic response upset me.

Your direct request for more information does not appear to have met with any success, so why not try sarcasm?

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to Tax Dragon
24th Mar 2019 15:14

Quote:

Unnecessary, but (imho) deserved.

If the OP asks for personal advice ("Does this make sense from a tax perspective for us and them?") and gives no personal information, then I won't let a sarcastic response upset me.

There was (probably still is) a computing saying "Garbage in, garbage out". I know some posters try hard to be helpful by either guessing or assuming missing facts or by asking for more information (which is more often than not never given). I think this question is an absolutely prime example of why this site shouldn't be used by members of the public wanting free advice. Asking a question with basically little more than zero facts demonstrates a complete lack of appreciation of the potential complexities of tax - and ignores other issues which may be even more important. In so doing, it demonstrates a very low opinion of accounting professionals. It's like going on a site for doctors and saying: "I've got a spot on my backside, what do you reckon?".

Sift should just delete questions like this and refer posters to professional advice.

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to Tax Dragon
25th Mar 2019 10:24

Quote:

Unnecessary, but (imho) deserved.

If the OP asks for personal advice ("Does this make sense from a tax perspective for us and them?") and gives no personal information, then I won't let a sarcastic response upset me.

Your direct request for more information does not appear to have met with any success, so why not try sarcasm?

Agreed. Glad it's not just me who gets pulled up!

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By jcace
23rd Mar 2019 19:01

When you gift property (other than to your spouse or to charity), in general you are treated for capital gains tax as though you sold it at its market value.

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25th Mar 2019 10:45

To avoid CGT just gift it incrementally over say 7 years using your CGT annual exemptions (if you start now, i.e. by 5.4.19, it will be effectively just 6 years).

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25th Mar 2019 12:44

I will continue to call out boorish and disrespectful behaviour and I expect people to do the same to me. As of now the site should be open to all it would be almost impossible to ring fence it to accountants and taxation agents only. If we continue to be disrespectful we are in danger of putting people seeking advice from suitably qualified people. If you want to help do so in a responsible manner if you don't don't post

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to carnmores
25th Mar 2019 13:59

Quote:

I will continue to call out boorish and disrespectful behaviour and I expect people to do the same to me.

OK
Quote:
If you want to help do so in a responsible manner if you don't don't post

Dictating to others how they should post (or if they should post at all) is extremely disrespectful behaviour.

You have your opinion how members of the public raising queries on here should be treated. Others have a different opinion. You think that helping them will encourage them to give (paid) business to a professional. Others (including me) think that most will just grab all the free advice they can get and never engage a professional.

Whilst I disagree with your view, I accept it as a valid one. This is why I never tell others that they should not answer. Perhaps you could extend the same courtesy in the opposite direction.

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to stepurhan
25th Mar 2019 15:33

Good afternoon Steph we don't hear from you as much as we used to it it's always good to read your posts, well almost ;-).
i am very surprised by your comments , i do not dictate how people post i just said i would call out boorish and disrespectful behaviour. I do not call that boorish and disrespectful in fact absolutely the opposite, a very few individuals who post in such a manner appear to me to have no intention of helping anyway and are just venting. A cursory glance at the historic comments of some posters is very revealing.
thank you for your post keep them coming.

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25th Mar 2019 15:35

PS i maybe a little old fashioned for this twitter driven cynical trolling world

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25th Mar 2019 15:53

PPS shall we move to discussing brexit?

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