Grandparent gift of business property or money

naive_investor

I'm finding this a bit complicated and want some ideas please.

A grandparent who has retired wants to give my child the proceeds from the sale of a business property which they no longer need.

The plan is for the grandparent to sell and gift the money.

I think if they did this they would pay capital gains tax at 10% on the sale (entrepreneurs relief) and that the money they gifted would be a potentially exempt transfer for IHT. Grandparents estate will be above IHT threshold. Grandparent is not in good health so may not live 7 years.

This seems straightforward but is there a better way of having the desired effect. By better I mean tax efficient for all parties in terms of CGT and IHT. And are my assumptions correct?

Also who is the best source of advice here. A solicitor, Estate Agent or IFA?

Thanks for your thoughts.

AnotherJoe

The other factor to consider is, does grandparent (and indeed parent) wish child to have the money aged 18 come what may, whatever circumstances the child is in then ?

Once its been gifted to the child that is the situation. To avoid that you'd need some type of trust, at which point my knowledge runs out.

Keep_pedalling

If the business has been sold then surely the cashed raised will be part of their estate, so there will be no relief on the gift.

Winebottle

If the property is to be sold, there is not a better way of doing it. If there are other assets that do not have gains on them that could be sold, that would be better because capital gains disappear on death.

Alternatively, if the property itself was given and continued to be used for business purposes, CGT and IHT reliefs would be available.