Transfer property

[Mcdon]

If I transfer a property I own to my mother is there tax to pay?

Basically my mother has retired early and not due her pension for a few years. I want to gift her a property so she can rent it out.

Thanks in advance

[Peter D]

Assuming you have not been living in it then the transfer will be deemed a disposal at open market value so if you have a gain with respect to the acquisition value then CGT will apply. You have a CG allowance of £10,600 and acquistion costs and sales and legal fees will be deductible. Have you considered just gifting her a share, say 10%, then use a simple written declaration to apportion the rental income to your Mum. You both have to sign it and file it away. Regards Peter

[Mcdon]

Thanks very much for the advice, I have been living there currently but will move before hand.

What I want to do is give my mother an I come for life so she has no worries but want to do it in most tax efficient way. I am a high rate tax payer so if I rent the flat out I will have to pay 40% tax on it and then give the after tax income to my mother to live on. However if I just gift her the whole flat I figured she can then pay 20% tax on the rent income.

Any advice appreciated.

[Peter D]

As I suggested above. But if you lived in the property for the duration then there would be no CGT so you could gift her the property but beware of pushing her total estate in excess of her NRB for IHT purposes. Regards Peter

[Incredulum]

1. What is the value of her estate?

2. What is the value of this property, how long have you owned it/and lived in it, and what did it cost you?