Gift of outbuilding to daughter

[vf001]

I have a client who owns a house set in 10 acres of pony paddocks with a run down barn across the yard from the main house that he wishes to gift to his daughter to renovate at her expense so she can live there. Does anyone have any experience of the potential CGT implications. My main concern is whether the barn could be considered to be within the curtilege of the main dwelling and therefore could be gifted free of any CGT implications. It is literally across the yard from the house and both are separated from the paddocks by fencing.

[SteLacca]

You may want to have a look at a couple of pertinent tax cases to get an idea. Varty v Lynes stipulated that the land must remain a part of the garden at the time of disposal to be a part of the permitted area for private residence relief to apply.

May also be worth looking at http://www.bailii.org/cgi-bin/markup.cgi?doc=/uk/cases/UKFTT/TC/2013/TC03037.html&query=Anne+and+Dickinson&method=boolean particularly with regards to timing etc.

[maths]

The answer will depend upon the precise facts.

A gift of the barn (and land thereunder) will constitute a part disposal for CGT.

As to whether any attributable gain will be subject to CGT or whether private residence relief will be available will, as stated above, depend upon the precise facts.