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can I sell house to daughter for less than value?
Comments
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If you do a "purchase at undervalue from a family member" then the contract shows the higher or "gross" price, or £120,000 in this case, with a "net" price of £95,000 actually changing hands on completion.
There's no "deposit" if it isn't done this way.I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.0 -
Thanks, so the SDLT would be based on the £120k? Does it have to be done as a gifted deposit, or would any mortgage lender just give a £95k mortgage on a £120k property using the equity as a deposit?kingstreet wrote: »If you do a "purchase at undervalue from a family member" then the contract shows the higher or "gross" price, or £120,000 in this case, with a "net" price of £95,000 actually changing hands on completion.
There's no "deposit" if it isn't done this way.0 -
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Ok so the SDLT would be payable on the £95k?
Stamp duty is based on the full market value, same as capital gains tax. If you don't do this you would have loads of tax avoidance transactions where you buy 50% of a house then the other 50% a week later.Declutterbug-in-progress.⭐️⭐️⭐️ ⭐️⭐️0 -
Stamp duty is based on the full market value, same as capital gains tax. If you don't do this you would have loads of tax avoidance transactions where you buy 50% of a house then the other 50% a week later.
No, SDLT isn't based on market value - if someone gifts a property to someone else then there is no stamp duty payable (unless it is a gift of part of the property and there is a mortgage on it).0 -
No, SDLT isn't based on market value - if someone gifts a property to someone else then there is no stamp duty payable (unless it is a gift of part of the property and there is a mortgage on it).
A gift of the entire property is generally seen as different to selling undervalue/ gifted deposits, it is usually given an exemption.
http://www.hmrc.gov.uk/sdlt/calculate/transfer-ownership.htm
http://www.hmrc.gov.uk/avoidance/spotlights10.htmDeclutterbug-in-progress.⭐️⭐️⭐️ ⭐️⭐️0 -
I thought there was no stampy duty on a house of this value anyway. Or has that changed yet again?
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LittleMissGiggles123 wrote: »I thought there was no stampy duty on a house of this value anyway. Or has that changed yet again?
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I think we have moved onto more general discussion on tax. Stamp duty can be based on any value, but the amount may be 0% which equals £0.Declutterbug-in-progress.⭐️⭐️⭐️ ⭐️⭐️0 -
LittleMissGiggles123 wrote: »I thought there was no stampy duty on a house of this value anyway. Or has that changed yet again?
x
Well spotted, you are absolutely right, zero SDLT on properties up to £125K, I'm a bit surprised that other posters didn't notice that.0
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