Buying land from parents; What tax????

alisma73

I'm buying some of my parents garden from them to build a house, can we avoid capital gains and can they sell below market value? I'm buying in installments, will cost £120K in total. Also at what stage can we transfer it into my name - when I have paid what percentage???

Thanks

Guest101

Why would you pay capital gains? Are you selling a property to do this?

Assuming there's no charge son the land, you can transfer whenever you want.

They may be liable for tax on the sale, but it's quite a tricky situation.

antrobus

alisma73 wrote: »

I'm buying some of my parents garden from them to build a house, can we avoid capital gains and can they sell below market value?...

You use the market value of the property instead of the sale price if, for example:

• You give the property away.
• You intentionally sell or dispose of the property for less than it's worth.
• You sell or dispose of the property to a 'connected person', such as a close relative or a company you control.

http://www.hmrc.gov.uk/cgt/property/calc-cgt.htm


However, Private Residence Relief may be available.

You may qualify for this relief if you sell part of the garden without selling your home at the same time.

http://www.hmrc.gov.uk/cgt/property/sell-own-home.htm

It depends on the size of the garden etc.
http://www.telegraph.co.uk/finance/personalfinance/consumertips/2905906/The-garden-inquiries-bear-fruit.html

alisma73 wrote: »

.... I'm buying in installments, will cost £120K in total. Also at what stage can we transfer it into my name - when I have paid what percentage???...

You transfer title when you want to transfer ownership. Payment of the sum due can be made at anytime.

alisma73

Guest101 wrote: »

Why would you pay capital gains? Are you selling a property to do this?

Assuming there's no charge son the land, you can transfer whenever you want.

They may be liable for tax on the sale, but it's quite a tricky situation.

I've already sold my property and moved in with parents. I'd like to avoid them paying capital gains and don't want them to be seen as gifting if I pay in installments after land registered to me. Basically want to avoid any tax if possible!!!