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Where Taxpayers and Advisers Meet

Passing property back

Nicklam
Posts:44
Joined:Sun Jan 19, 2020 1:00 am
Passing property back

Postby Nicklam » Wed Mar 10, 2021 6:56 pm

I was gifted a property my father and I lived together in. The time has come for me to move on. It's always been our main residence.

I checked the tenancy and we are joint tenants and at one point we severed the tenancy when we created wills.

If I gift my share of the property back to him so he becomes the sole owner, is there any sdlt implications for any of us. There is no mortgage or money being exchanged between us.

Finally I know 7 years will start for me when I regift back. But will a PET also start for him on receiving the property back. What happens if he dies within 7 years of receiving the property back?

AGoodman
Posts:1738
Joined:Fri May 16, 2014 3:47 pm

Re: Passing property back

Postby AGoodman » Thu Mar 11, 2021 12:06 pm

There's no SDLT as no payment (or deemed payment) is changing hands.

You are making the PET (as you know) and so the 7 years is only relevant to you.

As soon as you make the gift the property is in your father's estate so would be subject to IHT on his death

Nicklam
Posts:44
Joined:Sun Jan 19, 2020 1:00 am

Re: Passing property back

Postby Nicklam » Thu Mar 11, 2021 12:45 pm

Thanks. Just another question will there be any issues in me inheriting the property back in the future (because I regifted my share back)

AGoodman
Posts:1738
Joined:Fri May 16, 2014 3:47 pm

Re: Passing property back

Postby AGoodman » Thu Mar 11, 2021 5:51 pm

No, it's just a little inefficient if your father's estate is subject to IHT.

Nicklam
Posts:44
Joined:Sun Jan 19, 2020 1:00 am

Re: Passing property back

Postby Nicklam » Thu Mar 11, 2021 8:12 pm

Thanks agoodman.

Any issues with parent gifting money to me later like 6 months later. Can it be linked to transfer of the property back, or will it be seen as a separate event?

bd6759
Posts:4262
Joined:Sat Feb 01, 2014 3:26 pm

Re: Passing property back

Postby bd6759 » Thu Mar 11, 2021 10:35 pm

You gift a property to your father.

Your father gifts you money.

I don't think anyone will fall for that.

Nicklam
Posts:44
Joined:Sun Jan 19, 2020 1:00 am

Re: Passing property back

Postby Nicklam » Fri Mar 12, 2021 9:06 am

You gift a property to your father.

Your father gifts you money.

I don't think anyone will fall for that.
Even if the transaction happens at different times. In order for me to move out parent wants to gift me a small amount of money around 50k. This transaction is nothing to do with me gifting the house back to him, but can it be seen as being connected? The gift of money is more for helping me buy furniture and do some renovation in my new place.
But I don't want to take the money if it can cause us any issues down the line.

SDLT Geek
Posts:232
Joined:Sun Apr 30, 2017 5:45 pm

Re: Passing property back

Postby SDLT Geek » Fri Mar 12, 2021 9:19 pm

Still not falling for that!!

bd6759
Posts:4262
Joined:Sat Feb 01, 2014 3:26 pm

Re: Passing property back

Postby bd6759 » Sat Mar 13, 2021 12:05 am

But if the “gift” is only £50000, it is within the SDLT nil rate band, so no consequences.

SDLT Geek
Posts:232
Joined:Sun Apr 30, 2017 5:45 pm

Re: Passing property back

Postby SDLT Geek » Sat Mar 13, 2021 6:12 pm

A land transaction return would be required. SDLT would be due if the 3% surcharge for additional properties applies.


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