Gifting a property

Runningfast

00ec25 wrote: »

so you are relaying info 2nd hand and have no real idea of the underlying facts and figures. You may not be lying, but you are misleading us through failure to give the precise circumstances.

your best bet is to recommend to them that they do indeed appoint a solicitor to deal with the transfer and tell the solicitor the full facts so that a correct tax calculation may be worked out. Attempting to DIY it via 3rd party info such as you can provide may be counter-productive as you now realise.

Given the trivial values you mention it is very probable that no CGT will actually be payable, but until the precise calculation is done no one knows for sure!

There is no misleading going on the facts are there in my posts. This trial started because of an error in my use of English. My original post was longer with more detail but I edited it and on a 4inch phone screen I never really noticed my bad choice of initial words.

The facts are there 1 property is owned. It is empty. The child lives away. The parent rents a property. The parent will live in the flat after transfer as their sole place. The flat cannot be mortgaged in the current market in this area even though it was originally bought on a mortgage before 2008. The most recent nationwide surveyor valuation of 40k was from this year.

Is there a website that allows you to roughly calculate the taxes before proceeding formally?

I really appreciate the advice people give.

Land_Registry

00ec25 wrote: »

the answer to your question is here:
https://www.gov.uk/registering-land-or-property-with-land-registry/transfer-ownership-of-your-property

it requires you to submit 3 forms:

- TR1
https://www.gov.uk/government/publications/registered-titles-whole-transfer-tr1
- ID 1 which must be counter signed by a solicitor (or in person at a LR office)
https://www.gov.uk/government/publications/verify-identity-citizen-id1
- AP1
https://www.gov.uk/government/publications/change-the-register-ap1

Very minor and pedantic point, sorry - both parties will need to complete a form ID1 so 4 forms from a registration perspective

agrinnall

Runningfast wrote: »

Parent will live in it after the transfer

Where are the parents living now and why do they want to move (if indeed they do want to, or are they doing it just to help out the child)?

Keeping a studio flat "in the family" seems rather odd, it's hardly the ancestral pile is it? If it was me I'd just put it on the market at a price that will sell to a cash buyer.

xylophone

The OP states that the value of the property "has crashed" - is he saying that the value now is less than the original purchase price?

AnotherJoe

Seems to me very unlikely there will be any CGT if the flat is valued at £45K (and "prices have crashed" to boot) !

The parent gets to stop paying rent, I suggest thats whats in it for them.

saajan_12

Not sure why this is getting so agitated, or why a choice of words necessarily indicates fraud. You've

To check I understand the situation, child owns 1 empty property and rents elsewhere. Parent rents another property and would like to move into the studio flat once they are given it.

-> No stamp duty on a gift as the parent isn't paying any consideration.
-> CGT would be due on the increase in value, but likely 0. Roughly, this is caluclated as
X = Current Value - Purchase price - buying costs - 11k allowance.
If X is less than 0, there is no tax to pay. If not, there are other allowances to subtract based on the period the child lived there and then 18 / 28% of the result would be the CGT.

You can DIY or get a solicitor for the relevant forms, but the tax situation is fairly simple in my opinion.

Runningfast

saajan_12 wrote: »

Not sure why this is getting so agitated, or why a choice of words necessarily indicates fraud. You've

To check I understand the situation, child owns 1 empty property and rents elsewhere. Parent rents another property and would like to move into the studio flat once they are given it.

-> No stamp duty on a gift as the parent isn't paying any consideration.
-> CGT would be due on the increase in value, but likely 0. Roughly, this is caluclated as
X = Current Value - Purchase price - buying costs - 11k allowance.
If X is less than 0, there is no tax to pay. If not, there are other allowances to subtract based on the period the child lived there and then 18 / 28% of the result would be the CGT.

You can DIY or get a solicitor for the relevant forms, but the tax situation is fairly simple in my opinion.

Thank you, You have understood correctly.

Wouldn't be the money saving expert forum without the other tussle and agro though!!

CIS

Thanks, the child is currently renting another property hundreds of miles away while paying 150% council tax plus maintenance fees,

If it's in England then the premium doesn't apply if the property is furnished.

Craig

Slithery

CIS wrote: »

If it's in England then the premium doesn't apply if the property is furnished.

Craig

Does this apply everywhere in England?
I thought that all councils had their own rules.

00ec25

Slithery wrote: »

Does this apply everywhere in England?
I thought that all councils had their own rules.

the statutory position for the premium to kick in is that the property has to be both empty (ie unoccupied) and unfurnished and in that state for 2 years
https://www.gov.uk/government/publications/council-tax-empty-homes-premium

the premium cannot apply before 2 years. The local rules you refer to relate to what level of discount a council may or may not give for an empty/unoccupied/unfurnished property before 2 years are up. All councils apply the premium after 2 years for obvious financial reasons