Plots, self build, joint ownership CGT

[dotto]

My questions are as follows and any help would be greatly appreciated.

1 My two sons and I purchased in equal shares a bungalow with a fairly long garden.
2 My eldest son and myself live in the bungalow, youngest son lives in a house nearby which is owned by himself and his brother and which has a BTL mortgage on it. We all state our PPR as the bungalow.
3 Our intentions are
a) To sell Plot 2 which is next to the bungalow (the bungalow and the plots lie in a straight line with Plot 2 in the middle).
b) My sons to purchase my share of Plot 1 and use their remaining proceeds from the sale of Plot 2 plus some savings to build a house on Plot 1.
c) My sons will live in the new house on Plot 1 until they decide whether they can afford to keep it (this will mean selling the other house they jointly own).
d) Unless we win the lottery, and let’s face it, circumstances can change, my view is that they will eventually see sense and sell the new build on Plot 1 and keep the less expensive house they jointly own.
4 Therefore the questions are :
i) I sell my share of Plot 2 to my sons and remain living in the bungalow which we will still own equally and each have as our PPR. My sons will then fully own plot 1. Should we ensure they purchase my part of Plot 1 at the same time as the contract is completed on the sale of Plot 2 whilst it is still all garden and will this involve any cgt payment on my part.
ii) My sons then build themselves a new property on Plot 1 and live in it for, say 12 months and use this as their PPR. If they decide they can’t afford to keep it and subsequently sell it, will they have any cgt to pay.
iii) Is there anything I have missed that should be taken into account.

Many thanks for any advice.

[Peter D]

Your youngest son can not claim the bungalow as he PPR. He does not live there. PPR is a matter of fact.
They would have to move into the new build lock stock and barrel for an undefined period of time. It does not sound as though this arrangement has any permanence and a claim to PPR may be rejected by HMRC.
You should consider registering as a property developer and using the IT route with all expenses accounted for rather than CGT.
Regards Peter

[dotto]

Thank you for your response. The other house jointly owned by my sons is a buy to let which my youngest son is currently renovating for re-letting. He will then return back to the bungalow. If they build the new house they will move into it lock stock and barrel and would hope to continue to reside there. However, as every penny of our money has gone into this venture it may be that they will decide to sell the new house and use part of the proceeds to pay off the buy to let mortgage on the other house which will then become my youngest sons' residential home. It is a less expensive house and therefore would release some equity. If the new house is sold after say eighteen months I am assuming from other posts that there will be no cgt to pay as this will be their ppr. None of us wants to sell the new house as we will be living in close proximity as a family but finances might dictate they have to.

My question is if we sell the middle plot which lies between our bungalow and the end plot, my sons will then purchase with their proceeds my share of the end plot. They will then build the new house and live there. Do we need to ensure that the sale of the middle plot and the purchase by my sons of my share of the end plot go through at the same time to ensure the end plot does not become separated and thereby be viewed as being no longer part of the bungalow garden.

Again, thank you for any advice.