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Where Taxpayers and Advisers Meet

stamp duty will i need to pay?

piper777
Posts:42
Joined:Mon Jan 28, 2013 4:53 pm
stamp duty will i need to pay?

Postby piper777 » Mon May 01, 2017 10:33 am

Hi there tax advisors ----can u please advise ??

My elderly grandad wishes to give half of his share of his house to my self and his son.(1/4 each). he no longer lives in it.

value of house apprx £560.00

i wish to buy the 1/4 share left to his son as he would prefer the money. what is the best way to avoid stamp duty?

i am thinking that the 1/4 share is worth £115.000 ---- can i just buy it off him and not have to pay stamp duty --- even if this is my second home?

Also this would not later be seen as a gift with reservation and subject to IHT?

thank you for your help

piper777
Posts:42
Joined:Mon Jan 28, 2013 4:53 pm

Re: stamp duty will i need to pay?

Postby piper777 » Mon May 01, 2017 11:26 am

correction 1/4 share £140.000 ---sorry !

maths
Posts:8507
Joined:Wed Aug 06, 2008 3:25 pm

Re: stamp duty will i need to pay?

Postby maths » Mon May 01, 2017 6:32 pm

Any purchase of an interest will precipitate an SDLT charge. As you already own a dwelling then the 3% SDLT charge will also apply.

A gift gives rise to no SDLT.

No gift with reservation issues arises (as grandad doesn't live in the property).

Grandad may have a CGT exposure on making the gifts (unless he intends to leave the interests by will on death).

piper777
Posts:42
Joined:Mon Jan 28, 2013 4:53 pm

Re: stamp duty will i need to pay?

Postby piper777 » Mon May 01, 2017 6:48 pm

thank you Maths

Grandad has only moved out of home to live with daughter due to ill health ----- lived in house for 40 years so presume no CGT ??

But to clarify ---as have not bought first house yet ---just thinking of doing so

if grandad gives me 1/4 house now no SDLT ---if i buy the other 1/4 from his son now and it is below 125.000 ----i will not have to pay any stamp duty tax???

maths
Posts:8507
Joined:Wed Aug 06, 2008 3:25 pm

Re: stamp duty will i need to pay?

Postby maths » Mon May 01, 2017 7:17 pm

Grandad has only moved out of home to live with daughter due to ill health ----- lived in house for 40 years so presume no CGT ??
No CGT.
if grandad gives me 1/4 house now no SDLT ---if i buy the other 1/4 from his son now and it is below 125.000 ----i will not have to pay any stamp duty tax???
No SDLT if you don't own another property and purchase price below £125K.

piper777
Posts:42
Joined:Mon Jan 28, 2013 4:53 pm

Re: stamp duty will i need to pay?

Postby piper777 » Mon May 01, 2017 7:26 pm

and no cgt for grandad ??? -thanks maths


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