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Hi, my name is ***** ***** I am a chartered tax advisor. What would you estimate is the current market value of the house?
Kind regards, Peter
Thanks for the additional detail. I will give this some thought and get back to you later today.
Ok, so I understand you will be paying off your let property mortgage, selling your let property to your mother, and using the cash received from her you will be buying a new property with your partner. Please let me know if my understanding is incorrect.
You will be subject to capital gains tax on the transfer to your mother regardless of what she gives you in return because for capital gains tax purposes you are connected with her. Even if you gifted it to her for nothing you would still be subject to CGT on its market value.
I attach a very rough indicative calculation of the gain you may incur based on many assumptions and estimations (I accept no liability for inaccuracy! If you need figures to rely on you will need to engage formally with an accountant).
From April 2020 the lettings relief will be taken away and the final period exemption will be reduced from 18 months to 9 months. Therefore if you were to transfer the property after 6 April 2020 the tax charge would be considerably bigger.
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