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taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
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Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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I have client who currently owns a Limited company which holds

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I have client who currently owns a Limited company which holds one asset - a property in Portugal. My client also owns 2 properties in the UK in his personal name. None of the properties have mortgages on them. Can he transfer the ownership of the UK properties to the Limited Company also? It is incorporated in England & Wales
Submitted: 2 years ago.
Category: Tax
Expert:  taxadvisor.uk replied 2 years ago.
Hello and welcome to the site. Thank you for your question.

Yes, he can transfer the ownership of the UK properties to the LTD compnay.
A transfer of ownership to the limited company would mean there is a sale of a chargeable asset to the Ltd company.

If these properties are investment properties earning rental income then the whole gain would be chargeable to CGT unless the current value of the properties is lower then the buying price.

I hope this is helpful and answers your question.


If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.

Customer: replied 2 years ago.

The chargeable gain is the value between the original cost and the current market value? And stamp duty is also a liability/


 

Expert:  taxadvisor.uk replied 2 years ago.
Helen, thank you for your reply.

A gain is the difference between original cost and selling price/current market value. You are allowed to deduct the costs associated with buying and selling the property e.g. legal fees, stamp duty, survey fee etc.

A chargeable gain would be gain less gains annual exempt amount (current tax year £11,000).

I hope this is helpful and answers your question.
Customer: replied 2 years ago.

If the properties were transferred for the same value they were purchased, would this mitigate the liability of CGT but still leave Stamp tax a consideration?


 

Expert:  taxadvisor.uk replied 2 years ago.
Helen, thank you for your reply.

If the transfer value was equvalent to the buying price, then there is no gain and therefore no CGT payable.

Stamp duty would be payable depending on the value of the property.

I hope this is helpful.
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 4794
Experience: FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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Expert:  taxadvisor.uk replied 2 years ago.
I thank you for accepting my answer.

Best wishes.

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