Transferring ownership - Spanish holiday home

[JimD]

My father wishes to gift me a holiday apartment bought in Andalucia 20 years ago.
My mother(not on the title)and wy brother are keen for this transfer to take place.
What is the most tax efficient method?

[Nigel Lord]

JimD

This depends on the original cost and present market value. There are also consequences if you or your father have a tax presence outside the UK.

Assuming that your father is a UK resident (and is UK domiciled) any transfer would be subject to UK CGT at the open market value at the date of transfer as you and your father are connected persons. It would also be a Potential Exempt Transfer (PET) for Inheritance Tax (IHT) purposes.

The use of a discretionary trust could indefinitely defer any CGT liability and could be effective for IHT purposes.

You should take professional advice prior to making any transfer as there are potentially serious tax consequences if the optimun strategy is not adopted.

Our firm specialises in this type of tax planning. If you require any further assistance please do not hesitate to contact us, and we will be happy to act on your behalf.

Nigel Lord
Lord Associates
Taxation & Business Consultants
Caxton House
Old Station Road
Loughton
Essex, IG10 4PE
020 8418 9101 & 07769 931852
mail@lordassociates.co.uk

[assetlink@eircom.net]

Your dad could transfer the company to a "offshore nominee company" and then transfer the shares to you.


Raymond Kearney
Assetlink Consulting Corp. Ltd
Assetlink@eircom.net

[Nigel Lord]

Raymond

Please would you explain how this would assist JimD?

Surely, if his father is UK resident/domiciled, any transfer to a company would be a chargeable transfer at market value resulting in a CGT charge? Similarly, the gift of the shares to JimD would be a PET for IHT purposes.

Please would you elaborate?

Nigel Lord
Lord Associates
Taxation & Business Consultants
Caxton House
Old Station Road
Loughton
Essex, IG10 4PE
020 8418 9101 & 07769 931852
mail@lordassociates.co.uk

[JimD]

Sorry Gents
Don't feel much further forward!
My dad is domiciled uk but I thought spanish tax laws applied.
Inention was to "sell" property to me and I would pay spanish property transfer tax on Hacienda value.
Not as simple?

[Nigel Lord]

Jim

I have discussed with Raymond, and my advice stands.

Yes there will be Spanish taxes to consider, and there would potentially be double tax relief against the UK liability.

If you require bespoke advice, please let me have details of the date of acquisition, purchase price, and costs of acquisition, as well as the present open market valuation of the property.

Nigel Lord
mail@lordassociates.co.uk