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bigduckontax
bigduckontax, Accountant
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As husband and wife team, we have few buy to let properties,

Resolved Question:

As husband and wife team, we have few buy to let properties, all in equal shares.
Recently I read that there is no CGT to pay, if I buy my wife's share in any property at the market price.
Once having bought her share at market price,, then I gift the same share to my son and live seven years in order to avoid paying IHT. on same half of the property.
I wonder this would be acceptable to Tax man.
Submitted: 3 months ago.
Category: Tax
Expert:  bigduckontax replied 3 months ago.

Hello, I am Keith, one of the experts on Just Answer, and pleased to be able to help you with your question.

Inter spousal transfers do not attract CGT.

Gifts are covered by the seven years rule. They create a Potentially Exempt Transfer (PET) in the donors IHT affairs. PETs run off at a taper over 7 years. In the event of a decease within this period they are added back to the donor's estate for IHT purposes. PETs are the first to suffer IHT and should the estate be insufficient to meet the tax on the PET the liability cascades down to be beneficiary for immediate payment.

It would be acceptable to HMRC, it is the current legislation on the subject.

I do hope you have found my reply of assistance.

Customer: replied 3 months ago.
Thank you, Keith.
I understand about PET.
So I can gift my wife's share of buy to let, to my son without paying CGT, as I will be buying her share at market value.
Please confirm.
Expert:  bigduckontax replied 3 months ago.

Yes, assuming that there is no difference between the current market value as at donation and the price you paid your spouse.

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Expert:  bigduckontax replied 3 months ago.

Thank you for your support.