Avoid CGT on Transfer of Ownership of House

[robert74]

Hi, I very much hope someone could give us some advice, I will try and keep facts brief and to the point, if there is anything else I need to provide please let me know if you can assist.

In 2003 I was unable to get a mortgage, so my parents took out a mortgage to buy the house that I have lived in since then.

I paid the deposit, and have made all the mortgage payments, - I have almost paid it off ( 3 payments left to make )

As agreed with my parents at the time, once the mortgage is paid off, we planned to transfer ownership of the house to me.

Sadly at the time we were a bit naive and were unaware of the problems of CGT... ( my parents own their house that they live in )

I most of the bank statements etc that can show that I have paid the mortgage in full, and of course can show that I have lived here.

Is there a way ( ideally simple! ) that we can avoid CGT when they effectively transfer the ownership of the house to me?

Also, does anyone know, do we both need a seperate solicitor, such as when selling / buying, or can one solicitor do the full job? ( There is no dispute over the house, we are in full agreement of what should happen )

Any thanks, hints or tips would be very much appreciated.

Thanks,

Rob

[robert74]

Any ideas guys? There seems to be some experts on here...
Is there more information I need to post to help anyone give a response?
Been reading a few bits, not sure if there is a way to declare it as my PPR if that helps?

[Peter D]

On the facts you have provided your parents will have a CGT liability at the date of the transfer. As you have paid all the bills and actually live there you need to speak to a well versed solicitor to see if there is a way forward, perhaps a Bere Trust was formed when they purchased the property. As houcse prices have fallen a lot of late what was the purchase prive and what is the open market value of the property now.
Contact
Lee Young
Solicitor, Chartered Tax Adviser and Trust and Estate Practitioner

Partner, Frettens LLP
leeyoung@frettens.co.uk
01202 491701
And see if he can help you

Regards Peter

[Incredulum]

Almost certainly there is no CGT on the transfer of legal title as you are, always have been, and will be, beneficial owner of the house, having made all the payments.

[mullet]

I agree no CGT liability, as I have been in that situation. If someone is merely a guarantor in these circumstances, then they will not be beneficial owners. Who benefits from the asset? The OP. He lives in it and will enjoy the disposal proceeds. Even if his parents had contributed to the mortgage, such payments could have been treated as gifts rather than the acquisition of a beneficial interest in the asset.