Gifting a rental property to your children or grandchildren and CGT

UnsureAboutthis

Hello

The scenario/possibilities are above. The property is in England.

If someone were to gift a BTL to their child/grandchild, I'm aware there may be a CGT liability
depending on any price gains and allowances/etc.

Once this BTL property was gifted as mentioned above, two questions.

1: If the child/grandchild were to live in their as their main residence and then they sold the property
 at a higher valuation when compared to when the property was gifted, would there be any CGT on the gains? ((minus allwances)

2:  If the child/grandchild decided to rent out the above property for a few years, let's say 5 years and then live in it as 
their main residence: what would be the CGT position if the property were to be sold for more than the valuation at the date of the gift?

Thanking you in advance for your time and help.

Keep_pedalling

1. No, it would be the primary residence so exempt from CGT.

2. That would depend on the length of time it was rented out and the amount it gained in value, primary residence relief would apply for the time they occupied it plus last 9 months of ownership. Assuming they moved out to a property they were purchasing then they would be hit with an additional 5-8% (depending on which part of the UK they live  in) tax on their purchase.

if the child / grandchild receiving the gift is not already a home owner then to avoid them loosing their first time buyers status and the additional taxation on their first purchase the better option would be to sell and gift cash instead.

UnsureAboutthis

@Keep_pedalling
Many thanks for the easy to read answers.