CGT when changing property share

stevesey

Hi

My daughter and I are tennants in common and I want to increase her percentage (I don't live there). This is likely to involve some CGT as I've left it too late to drip feed with CGT allowance being cut. How do I go about reporting this to HMRC is it just a case of filling out the normal property sale form - but using market value and value for the percentage being transferred?

This would make sense but the guidance notes aren't that helpful as they are focused on property sales.

Should I also send copies of the deed declaring the split? And ay earlier deeds (that wouldn't have triggered CGT as below allowance).

TIA

Steve

Jeremy535897

I assume that there is no mortgage on the property? Is it your daughter's main residence? Do you currently complete self assessment tax returns?

You will have to get a valuation for the proportion of the property you decide to gift. Within 60 days of the transfer, you will need to report the capital gain and pay the tax, and then you will need to complete a self assessment tax return and report the same transaction, unless you are not required to complete a self assessment tax return for any other reason, and the tax already paid turns out to be correct.

If you transfer a share by 5 April 2023, and if you file your self assessment tax return for 2022/23 within 60 days of the transfer (showing all your income and gains as usual), you don't need to use the online reporting system, and will have until 31 January 2024 to pay the tax, as opposed to 60 days from the date of the transfer.

I doubt HMRC will want copies of the transfer deeds, but you will need to tick the box where it asks if any valuations are used, and explain what you have done in the appropriate white space.

You will be making a potentially exempt transfer for inheritance tax purposes, which will reduce the amount of nil rate band available on your death if you die within seven years of the gift.

If part of a mortgage is transferred as well, there may be stamp duty consequences.

Robert_McGeddon

Is your estate (including your share of the house) likely to be subject to IHT (after RNRB included)?