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TonyTax
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15940
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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I HAVE A SECOND PROPERTY WHICH I WOULD LIKE TO "GIVE" TO MY

Customer Question

I HAVE A SECOND PROPERTY WHICH I WOULD LIKE TO "GIVE" TO MY CHILDREN. IF I DO SO I UNDERSTAND THAT THERE WOULD BE NO INHERITANCE TAX TO PAY IF I SURVIVE 7 YEARS.IF I MADE THE GIFT WOULD I HAVE TO PAY CAPITAL GAINS TAX ON THE GIFT AND IF SO CAN THAT BE "AVOIDED" IN SOME WAY?
THANK YOU
Submitted: 1 year ago.
Category: Tax
Expert:  TonyTax replied 1 year ago.
Hi. I'm afraid that, unless you are entitled to some reliefs which reduce the gain such as main residence relief and letting relief or the property is a furnished holiday let, then there really is no way to avoid a Capital Gains Tax liability when you make a gift of the property. Take a look here for information on the main residence and CGT. You might consider gifting it in stages over a number of tax years so as to use a number of annual CGT exemptions and pay tax on a reduced gain. However, an increase in the property's value may work against you. I wouldn't recommend trusts because of the Inheritance Tax 10 year and exit charges even though a CGT liability may be deferred. I hope this clarifies your situation but let me know if you have any further questions.
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Customer: replied 1 year ago.

Thank you very much.

A rock and a hard place as my family will have to sell the home to pay inheritance tax!!

Expert:  TonyTax replied 1 year ago.
Thanks.