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Changing ownership of rental properties.
Comments
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Just rang the tax office and it would not be liable for Capital Gains Tax. In order to make a gain, something has to be sold and a profit made. All I am doing is exchanging beneficial ownership so I am not gaining anything. Still unsure about stamp duty as the person I spoke to said he only deals with CGT. He said I needed to speak to the land registry, which I did at the start of the process, and they said they couldn't tell me.0
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Just rang the tax office and it would not be liable for Capital Gains Tax. In order to make a gain, something has to be sold and a profit made. All I am doing is exchanging beneficial ownership so I am not gaining anything. Still unsure about stamp duty as the person I spoke to said he only deals with CGT. He said I needed to speak to the land registry, which I did at the start of the process, and they said they couldn't tell me.
That doesn't sound right. Isn't the below exactly what you are proposing to do? The accountant in that case appears to be saying that CGT is due. Of course the rules might have changed since 2014.
https://www.telegraph.co.uk/finance/personalfinance/capital-gains-tax/11124506/Capital-gains-tax-Can-we-swap-houses-and-cut-our-tax-bill.html
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I was worried after reading the article which is why I rang the tax office. He was very clear that I wasn't making a profit so there is no CGT. The land registry never mentioned CGT when I spoke to them either. Maybe things have changed since the article was written. I would prefer that option to the one where the taxman has got it wrong.0
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Just rang the tax office and it would not be liable for Capital Gains Tax. In order to make a gain, something has to be sold and a profit made. All I am doing is exchanging beneficial ownership so I am not gaining anything. Still unsure about stamp duty as the person I spoke to said he only deals with CGT. He said I needed to speak to the land registry, which I did at the start of the process, and they said they couldn't tell me.
That is plain wrong I'm afraid. Plenty info on .GOV on when a Capital Gain arises.0 -
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The Land Registry have nothing to do with HMRC so they are unlikely to mention it.
If you don't believe us then speak to an accountant or tax advisor before you make a very expensive mistake.0 -
I'm afraid nothing has changed in that regard. CGT will be due on the manner of transfer of equity that you describe on a BTL property.
If you do choose to rely on the telephonic conversation, I would get it from HMRC in writing.I was worried after reading the article which is why I rang the tax office. He was very clear that I wasn't making a profit so there is no CGT. The land registry never mentioned CGT when I spoke to them either. Maybe things have changed since the article was written. I would prefer that option to the one where the taxman has got it wrong.0 -
Rang the Land Registry and HMRC Stamp Duty Helpline. Nobody seems to know what I'll have to pay but I have the option to void the transaction if the costs are too high. Takes 7 weeks for them to process the forms before I'll know.0
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Rang the Land Registry and HMRC Stamp Duty Helpline. Nobody seems to know what I'll have to pay but I have the option to void the transaction if the costs are too high. Takes 7 weeks for them to process the forms before I'll know.
Nobody is going to tell what CGT you have to pay, that will be up to you to Self Assess that in your Tax Return. By which time I imagine the time to void it will have passed.0 -
I would have thought you will also be liable for stamp duty maybe even the +3%.
You are not gifting the property you are selling it and getting in return another property which has a value.
If it were that easy to avoid stamp duty all sorts of avoidance schemes would crop up.0
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