Gifting land...

daveo2k

Hi
Thanks in advance for any help on this one!
My parents have land to the adjoining their house and they're looking to gift us part of this so that we can try to build a house.
The original plan was to do a transfer of title on the whole plot but now they've decided they want to keep half of the land (part of this plot will be used for access to ours) and go for planning permission on this once the plot was in our name. The main reason behind this was to try and avoid taxes and avoid lifting the cost of the plot...assuming a plot with planning is more valuable than without - I'm the first to admit that I don't understand the potential tax implications in gifting land.
I'm assuming the new plan will be to get the land split (no idea on how to do that or how expensive) then transfer the title to us and apply for planning.
Any advice on the order of what should happens and rough idea of costs for legal work would be great?
Thanks again
Dave

robatwork

I can't give you costs but just a point that springs out.
Let's say you proceed and build your house, and in 10 years your parents sell their property. You now don't have access to your own house.

daveo2k

Thanks robatwork
I know what your saying but I assume that is part of planning permission...shared access etc etc.
I'm sure that if access was a problem the land would be made available.
Dave

davidmcn

robatwork wrote: »

Let's say you proceed and build your house, and in 10 years your parents sell their property. You now don't have access to your own house.

Unless they're employing seriously incompetent solicitors, there'll be rights of access reserved in the title.

daveo2k

Thanks davidmcn, I'd thought as much but good to know.

lincroft1710

A plot without pp or "hope value" is garden land value - a few thousand pounds.

A plot with pp - £50K?, £100K? more? depending on size and location

daveo2k

Thanks lincroft, don't suppose you'd know about any taxes involved do you?

G_M

* safest/simplest order is to get planning permission 1st. There's no point splitting the land, transferring the title, if you then can't build on it. Unless you want to keep horses on it instead......

* only reason I can see for transferring the title 1st is potential Inheritance Tax. The value of a gift is included in the Estate if the donor dies within 7 years of the gift. So yes, if the land is worth less when gifted, and then your parents died (within 7 years) the estate would be taxed less than if a more valuable piece of land was gifted.

* if doing this, make sure you get a Valuation of the land at the time of the gift to keep for the Executers to use if needed

* Legal work for a TP1 - Transfer of Part (of a Title) will be higher than legal work for a TR1 - Transfer of Whole (title). Rather than standard conveyancing costs, you'll probbly need
* a surveyor to draw up a Plan for the Land Registry (this is just the boundary - nothing to do with planning permission or house-building)
* a Conveyance/Deed specifying the Rights of Access, obligations o contribute to maintenance of any access road over another Ttle's land, rights to run utility drains/wires across the other land etc
* but you might save on searches if you don't feel the need for them

For prices, you'll need to get estimates from 2-3 conveyancers & surveyors.

daveo2k

Thank you G_M