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F E Smith
F E Smith, Advocate
Category: Property Law
Satisfied Customers: 9436
Experience:  I have been practising for 30 years.
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My father and uncle own a property which contain 5 flats. I

Customer Question

My father and uncle own a property which contain 5 flats. I live in one of the flats but do not pay rent. The others are rented out through a letting agent. My father and uncle wish to transfer the property to me and my cousins as part of the 7 year rule as my grandparents did to them. My query is whether they are able to do that without incurring capital gains tax seeing as the property is essentially a business.
I would also like to know if it would be possible to set the property (along with a similar one that they own) up as a company with myself and my cousins ad directors. The property plus one other are worth in the region of 3.5 million.
Thank you
Submitted: 9 months ago.
Category: Property Law
Expert:  Nicola-mod replied 9 months ago.
Hello,
I've been working hard to find a Professional to assist you with your question, but sometimes finding the right Professional can take a little longer than expected.
I wonder whether you're ok with continuing to wait for an answer. If you are, please let me know and I will continue my search. If not, feel free to let me know and I will cancel this question for you.
Thank you!
Nicola
Expert:  Nicola-mod replied 9 months ago.
Hello,
I apologise as we have not yet been able to find a Professional to assist you. Do you wish for me to continue to search for someone to assist you or would you like for us to close your question at this time?
Thank you for your patience,
Nicola
Customer: replied 9 months ago.
Please continue.
Thanks
Expert:  Nicola-mod replied 9 months ago.
Hello,
We will continue to look for a Professional to assist you.
Thank you for your patience,
Nicola
Expert:  F E Smith replied 9 months ago.

Capital gains tax is literally what it says. A tax on the capital gain.

When they transfer the property to you they are selling it to you even though they may only be selling it for the consideration of 1 pound or even for no consideration. Hence, there is no gain and therefore no CGT to pay.

Can I clarify anything for you?

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Best wishes.

FES

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