Do I have to pay CGT if I sell my property with the price I purchased

FlorayG

Keep_pedalling said:

IamWood said:

How the market value is evaluated? I can gift the house to my son.

Is your son a home owner already? If not and he would not be using the house as his home this would not be a good move for him as he will loose his FTB status and will pay 5% additional SDLT when he does buy a place of his own.

sometimes the  better option is to sell, pay your CGT aad gift cash.

Well, no, actually, because if you do that your son HAS a home of his own so won't need FTB status

Keep_pedalling

FlorayG said:

Keep_pedalling said:

IamWood said:

How the market value is evaluated? I can gift the house to my son.

Is your son a home owner already? If not and he would not be using the house as his home this would not be a good move for him as he will loose his FTB status and will pay 5% additional SDLT when he does buy a place of his own.

sometimes the  better option is to sell, pay your CGT aad gift cash.

Well, no, actually, because if you do that your son HAS a home of his own so won't need FTB status

The OP has not said this will be his home, which is why I phrased my reply the way I did.

user1977

FlorayG said:

Keep_pedalling said:

IamWood said:

How the market value is evaluated? I can gift the house to my son.

Is your son a home owner already? If not and he would not be using the house as his home this would not be a good move for him as he will loose his FTB status and will pay 5% additional SDLT when he does buy a place of his own.

sometimes the  better option is to sell, pay your CGT aad gift cash.

Well, no, actually, because if you do that your son HAS a home of his own

He won't if the tenant is staying there.

AlexMac

Have a good look at the HMRC guidance online. I was debating whether do something similar; sell cheap or gift a second property - a rental flat - to our granddaughter who currently lives there as our tenant  

I even had a go at filling in a draft sample version of the online CGT calculator (which you can do anonymously). One of its first questions, (after asking whether I’d ever lived in the property -to determine any principal residence relief - and how much I’d paid for it) was “ did you sell for less than what it was worth”? 

I also read that after the disposal, I’d be required to submit a declaration; a Post Transaction Valuation Check for Capital Gains form CG34, including (I think- from memory) things like costs of purchase, fees and any improvements, as well as the basis of the valuation when I sold… and pay the CGT within 60 days. Presumably any conveyancing solicitor will know all about this so if you plan to ask a few to quote, you might just ask ‘em if that’s compulsory and if it requires evidence?

 In our case, as the property is shared by my wife, the total gain after costs of just over £90k+ each would have meant a CG Tax charge north of £20k each. Which seems fair, as we’ve seen amazing house price inflation, not to mention healthy rent income since buying it for peanuts almost 30 years ago. 

In the end, we decided ( as granddaughter really wants to move to a house with her new partner) not to go ahead as we assume that would sabotage her “First Time Buyer” tax advantage. 

crispy_duck

I don't understand the concern about losing FTB status. The value of any benefits lost there is surely going to be far outweighed by the benefit from buying at 15 years ago's price?

theartfullodger

Such an approach to tax will result in HMRC fining you plus charging you for what you should pay tax.  

Unless you are ....

Tax investigation by HMRC will take a lot of your time and money 

But hey, your choice!
.

silvercar

crispy_duck said:

I don't understand the concern about losing FTB status. The value of any benefits lost there is surely going to be far outweighed by the benefit from buying at 15 years ago's price?

Agreed - if it is a home you want to own and live in. If it is an investment and it means extra SDLT on the home you buy to live in then it is important - particularly if it means you can't afford the extra SDLT and therefore lose out on a house you would otherwise buy.