Background:
My self and my father have a shared BTL flat. I earn majority share however my father wishes to gift 1/2 he’s share to myself and I buy out the remaining he owes.
Any flaw in my plan:
Total gain= (%owned x current Valuation) - (original deposit + improvement costs)
Tax due - (assuming no gains for the year)
My father Pays tax on capital gain on the portion I wish to purchase.
Tax due = (Capital Gain allowance - (50% x Total Gain)) x 18%
Amount gifted to me (for me to declare on my return)
= (%owned x current Valuation) + Original Deposit
Now on this gifted amount can I defer this payment until flat is sold.
something like this.
Hold-Over relief
HM Revenue & Customs: Capital Gains Tax reliefs on property that's not your main home
What needs to be done to put this into action
- Title deeds to be changed to reflect change in ownership
- fathers return to show he’s portion sold and pay tax bill above
- my return declare gift on amount above
My self and my father have a shared BTL flat. I earn majority share however my father wishes to gift 1/2 he’s share to myself and I buy out the remaining he owes.
Any flaw in my plan:
Total gain= (%owned x current Valuation) - (original deposit + improvement costs)
Tax due - (assuming no gains for the year)
My father Pays tax on capital gain on the portion I wish to purchase.
Tax due = (Capital Gain allowance - (50% x Total Gain)) x 18%
Amount gifted to me (for me to declare on my return)
= (%owned x current Valuation) + Original Deposit
Now on this gifted amount can I defer this payment until flat is sold.
something like this.
Hold-Over relief
HM Revenue & Customs: Capital Gains Tax reliefs on property that's not your main home
What needs to be done to put this into action
- Title deeds to be changed to reflect change in ownership
- fathers return to show he’s portion sold and pay tax bill above
- my return declare gift on amount above
Comment