Gifted house, deferred CGT possible?
Gifted house, deferred CGT possible?
Author
Discussion

Jaroon

Original Poster:

1,441 posts

190 months

Saturday 10th August 2013
quotequote all
My folks are looking at gifting me one of their rental properties if I pay the CGT of circa 20k. I can't afford it right now but would like to do the transaction before the property accrues in value. Do the revenue have a facility for deferring the current level of CGT to me pending the sale of the property in my own right at a future date? I think I've heard about this happening but I might be imaging it. Cheers.

Edited by Jaroon on Saturday 10th August 21:46

Eric Mc

125,770 posts

295 months

Saturday 10th August 2013
quotequote all
The liability is your parents', not yours. You have nothing to defer.

westberks

1,444 posts

165 months

Sunday 11th August 2013
quotequote all
CGT isn't payable immediately anyway. also check to see if your parents will have used their allowance for that year which may offset the gain.

your parents will have to include it in their tax return which isn't due until January the following tax year, so if you time the transfer right you won't be liable for some time.

you could then raise the cash against the unencumbered property as a mortgage; providing your credit file is ok.

Tino

1,948 posts

313 months

Tuesday 13th August 2013
quotequote all
As above, time it so that you have the maximum amount of time between transfer and when the tax needs to be paid.
Then from the rental income and working and saving hard you should be able to raise most if not all of the £20k.

Jaroon

Original Poster:

1,441 posts

190 months

Tuesday 13th August 2013
quotequote all
Thanks peeps, timing correctly looks like our best option. Yes the 20k is due after both my folks cgt allowance has been applied.

It seems there is a deferral option but only if it is a business premise or a furnished holiday let property, not residental.

westberks

1,444 posts

165 months

Tuesday 13th August 2013
quotequote all
you might not be able to 'defer' but could buy yourself 18 months or so.