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CGT again

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My father has handed over the cottage that we have been living in for the past 25 years. The cottage is part of the family farm but has not been lived in at all by my parents. There is expected to be a CGT of 36k which i appreciate is my parents liability but we will be paying. Is there any way of lessening this bill? My parents are basic rate tax payers and their allowances have been included. In the past we have had to sign a document that allowed the bank to have a charge on the property when more land was purchased so i assume it was seen as security on the loan.
It is still a cheap house but it would be nice if we could lessen the debt.

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  • xylophone
    xylophone Posts: 45,602 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    http://www.hmrc.gov.uk/cgt/property/reliefs.htm

    Who or what owns the cottage - your parents? The farm business (limited co?).
    In the past we have had to sign a document that allowed the bank to have a charge on the property when more land was purchased so i assume it was seen as security on the loan.

    "We"? Your parents? The directors of the business/ You/your partner?

    Does the property still stand as a security for a loan (to your parents/the business/you?)

    Might it be a good idea to run this past the farm's accountant?
  • 00ec25
    00ec25 Posts: 9,123 Forumite
    1,000 Posts Combo Breaker
    you say "family farm" and you have been living in the cottage for 25 years.

    IF you are engaged in agriculture yourself whilst living there then, irrespective of the fact your parents have not occupied it, they as the transferor MAY be entitled to agricultural relief

    I suggest you read up on the bits relating to transfer of property and see if any applies
    http://www.hmrc.gov.uk/cto/customerguide/page17.htm#12
  • We have been farming on a fbt 60 acres about a mile away, we also own 4 acres and a large ag shed 1/4 mile away. The cottage is part of the family farm now run by parents and brothers. Im not sure if it is security any longer. The farm is not a ltd co.
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