1. Home
  2. UK Finance Discussions
  3. Sale of second home

Sale of second home

My brother and I jointly own a second home, which we are thinking of selling. We acquired it 20 years ago, and there is a large capital gain. Assume that we have both used our CGT allowances for the year of sale and are both 40% tax payers. Clearly, there's a substantial CGT bill if we sell.

One of my children is aged 25 and does not have a house of his own. There is nothing to stop him living in the house for a while and making it his PPR. Can my brother and I transfer the house to him at our base cost, or even free, and if he sells it after say 6 months of ownership will there be any CGT payable either by him or by my brother and I?

Thanks for any advice.

Reply to
GB
Loading thread data ...

No. Any gift will be taxed as though it's a disposal at the market value.

You could give part of your share to your wife (if you have one) and then she could use her CGT allowance.

If you both have wives then you could potentially give about 36K worth of gain to your son each tax year (assuming you don't use your allowance on anything else).

I'm no expert on this so there may be something better you can do (leave the country for five years?)

There's going to be a combination of indexation relief and taper relief available.

Tim.

Reply to
google

In message , snipped-for-privacy@woodall.me.uk writes

Yes, in fact the £36k of 'gain' could equate to quite a lot more of 'value' after these reliefs.

It would also help if each owner made the property their PPR for a while and get three years allowance so that the gain would be only 17/20 of what it would have been.

Reply to
John Boyle

You can take advantage of indexation and taper relief. Why don't you sell in a year were you don't have othe capital gains?

You will find that the tax payable is only a small percentage of the gain.

Reply to
Peter Saxton

BeanSmart website is not affiliated with any of the manufacturers or service providers discussed here. All logos and trade names are the property of their respective owners.