Five years ago, my son and I bought a property to let. I paid one-tenth, son paid the balance (with mortgage). Legal title in in son's name only. I have considered this is a bare trust and have paid IT on my one-tenth rent less expenses. I am now considering selling my tenth share to son. This will be a transfer between associates and the value will need to be agreed with HMRC for my CGT but I expect the value will be about £16000 -- and on this figure, the capital gain I have made will be covered by my annual CG exemption.
I intend to leave all of the proposed 16000 sale price on a loan (?interest free) of 16000 to my son to pay for my share,repayment by monthly instalments. This loan will of course be my asset and part of my estate for IHT.
If I then write off say 3000 of the 16000 am I right in thinking this will be a gift inter vivos and potentially chargeable to IHT unless I live 7 years ? Can I therefore claim this 3000 as within the annual gifts exemption for IHT -- no other gifts in the year. And then add a further 3000 from last years unused gift exemption -- ie 6000 in one stage or two separate movesin tax year 1. Or alternatively 3000 on 5 April yr 1, 3000 on 6 April in yr 2
I appreciate that proper documentation would be desirable
?Any other potential problems
Thanks for advice
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