CGT & BTL Sale. Any ideas?
Discussion
Mother has a BTL property, and lives (renting) elsewhere.
It is expected she will sell the BTL at some stage perhaps in 3yrs or so. The BTL property is expected to have tripled in value since she bought it approx 15yrs ago. So it is expected CGT will be due.
So thoughts are turning as to smart moves that could be done to reduce exposure to CGT. Any ideas?
One thing up for consideration is to transfer ownership from her personally to a company to reduce exposure to the higher rate of CGT. But maybe there are other options?
It is expected she will sell the BTL at some stage perhaps in 3yrs or so. The BTL property is expected to have tripled in value since she bought it approx 15yrs ago. So it is expected CGT will be due.
So thoughts are turning as to smart moves that could be done to reduce exposure to CGT. Any ideas?
One thing up for consideration is to transfer ownership from her personally to a company to reduce exposure to the higher rate of CGT. But maybe there are other options?
Blanco92 said:
One thing up for consideration is to transfer ownership from her personally to a company to reduce exposure to the higher rate of CGT. But maybe there are other options?
Transfer to company is no different to selling it to someone else… and you’d have the elevated SDLT to deal with as well. You’re going to struggle to find any way to avoid CGT on it.
I have an idea. Pay the tax
Based on that assumption and more importantly if the plan to sell is a definite, I would strongly suggest that while these lunatics are in charge potentially the future tax is only likely to get worse. I see no reason why they will not adjust such taxes upward , so best get out now rather than at a later future tax rate ?
The anguish of paying some new loony rate ( 40 % ? ) of CGT would soon wash away any bitterness in paying at todays rates
Based on that assumption and more importantly if the plan to sell is a definite, I would strongly suggest that while these lunatics are in charge potentially the future tax is only likely to get worse. I see no reason why they will not adjust such taxes upward , so best get out now rather than at a later future tax rate ?
The anguish of paying some new loony rate ( 40 % ? ) of CGT would soon wash away any bitterness in paying at todays rates
PM3 said:
People sure go off on tangents asking irrelevant questions. OP asked for ideas on CGT avoidance, not advice for mother as to where she wants/chooses to live .
It's hardly irrelevant. We've all agreed it's impossible to avoid so why not develop the thread a little, it's good internet etiquette.PM3 said:
People sure go off on tangents asking irrelevant questions. OP asked for ideas on CGT avoidance, not advice for mother as to where she wants/chooses to live .
The way I see it the only way to legitimately reduce the CGT is to move into the house and make it her main residence.So it's not going off on a tangent to suggest she moves in.
It makes not be feasible.
But then neither is moving the property to a ltd co.
Peterpetrole said:
MrBig said:
Isn't the usual answer to boot out the tenants from the BTL and live in it for 6 months?
Would still be taxed on the uplift for the whole time she wasn't living thereArmitage.Shanks said:
Peterpetrole said:
MrBig said:
Isn't the usual answer to boot out the tenants from the BTL and live in it for 6 months?
Would still be taxed on the uplift for the whole time she wasn't living thereIf for example I own it for 10 years, live in it for 5 years, is it simply 50% of the uplift that is taxed?
Thanks for being a sounding board, folks. I put it out there because I couldn't really think of a masterplan either.
To address some of the replies:
- The idea would be to sell it in approx 3yrs time and then buy somewhere for her to live. Not continue renting.
- Monies have been spent on the property. No grand extensions, but the kitchen was renovated. Other than that it has been basic repainting and new floor coverings etc.
I would need to crunch some numbers, but my understanding is to achieve lettings relief she'd have to "officially" live there and to achieve that she'd lose some income as she'd have to keep a room in the property for herself. Can't have your cake and eat it I suppose
To address some of the replies:
- The idea would be to sell it in approx 3yrs time and then buy somewhere for her to live. Not continue renting.
- Monies have been spent on the property. No grand extensions, but the kitchen was renovated. Other than that it has been basic repainting and new floor coverings etc.
I would need to crunch some numbers, but my understanding is to achieve lettings relief she'd have to "officially" live there and to achieve that she'd lose some income as she'd have to keep a room in the property for herself. Can't have your cake and eat it I suppose

Gassing Station | Finance | Top of Page | What's New | My Stuff