Capital Gains Tax on detached garden land

tole

Can anyone answer this one - Is it possible to transfer/gift only a proportion of the land to my children (in this tax year and say only £10k portion to each child)

If the land is worth 60k (jointly owned with the wife) - then we are transfering a 1/6th to one party and a 1/6 to another - leaving me and my wife holding 2/3rds of the land or £40ks worth

Therefore I can use this sale at full market value of a proportion of the land to offset against my cgt allowance for this tax year and then when the land eventually gets sold it will sold as owned by myself, my wife, son and daughter - and then we can all use our new cgt allowances in the new tax years to offset any gains??

Is this possible?

Or is there an easier way of just adding them to the ownership of the land?
I am no genius here - but does anyone think this is possible?

jimmo

tole wrote: »

Can anyone answer this one - Is it possible to transfer/gift only a proportion of the land to my children (in this tax year and say only £10k portion to each child)

That is entirely possible but it would need to be done very carefully, and quickly now given that the tax year ends next week.
“Asset Splitting” and “Fragmentation” are avoidance techniques well known to HMRC and they are constantly on the lookout for them.
Amongst the things to be considered are:
Any gifts of land to your children will need to be done in writing.
The children’s share of the proceeds of sale will have to go to them.
If the children are minors the gifts will have to go into trust and their share of the proceeds of sale may well be tied up until they become adults.
Take a look at all the pages linked here.
http://www.hmrc.gov.uk/manuals/cgmanual/CG18150+.htm