captial gains tax

llancayo

Hi , can anyone help please my son rents out a property and would like to put is mothers name on on the deeds of the house as one day she and i can live there many thanks

CLAPTON

whats the question exactly?

obviously you and your wife can live there if he agrees without ownership being transferred.

llancayo

thank you for reply my son whould like to give the house that he payed £100.000 for last month with no mortgage to his mother and put on her sole name only for us both to live there as he lives with his girl friend can he do this as got to pay capital gains tax or it best to add her name to the tranfur deed i am very concened about capital gains tax be very greatful for anyones help

CLAPTON

If he gives the house away or gives half the house away then the HMRC will consider this as a disposal for CGT purposes and he will be liable for CGT.

If he has never lived there as his principal private residence he will be liable to pay CGT.

The amount depends whether he gives it away this tax year (i.e. up to 5th April 2008) or next tax year as the 'pre-budget' speaks said that CGT rules will change then.

However if he only bought it last month then one can assume the value hasn't changed and so there would be no tax to pay as CGT is only charged on the GAIN and not the value.

llancayo

Thank you very much for your help about capital gains tax as it been a great help to me and my wife i know will let my son put in my wifes name one other qustion could she ever sell the property after we lived there if she was not happy living there

CLAPTON

If your wife owns the property then she can sell it whenever she likes. as it will be her home there will be no tax considerations.

llancayo

Thank you very much for your advice if there are no cgt on the property must my son inform his tax office of change of ownership many thanks llancayo

silvercar

Generally speaking, giving a property to a parent builds up future inheritance tax liabilities.