Selling property - reducing capital gains tax.

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bigdee77

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I have 2 properties & wish to sell the second property. Is there any way of reducing capital gains tax by for example transfering the property to my daughter & then selling it ? I have 2 daughters one of which already has a property & the other doesn't. Obviously i would not which to impact on any first time buyer perks etc for my daughter.
 
Transferring the property to your daughter will trigger Capital Gains Tax for you AND Stamp Duty and possibly Gift Tax for your daughter so thats a definite non-runner.

If you're selling a residential property and you havent lived in it as your Principal Residence, and you are likely to make a profit or gain on it then unfortunately you must pay CGT on the calculated gain at 33%
 
If it is ultimate intention to give your second daughter the second property, then this might be the best time to do it whilst property values are relatively low.

If you delay the transfer, property values might increase, and you will pay more CGT etc

Jim Stafford
 
What if I sell it to my daughter for a very small amount & then she sells it on for market price ? Then transfer the money back to me?
 
If you transfer property to a connected person market value is applies. If the current value is higher than the cost you pay CGT. If its lower then you can only use the loss against gains realised on sales to the same connected person.

There is stamp duty on the market value.

Your daughter may be subject to CAT on the amount she pays you and the market value there is a threshold father to daughter.

Having said that if she holds the property for more than seven years she may qualify for the CGT exemption
 
Whatever you charge your daughter - free or reduced price -the Revenue will make you pay CGT on the market value. And any liability by your daughter (inheritance or gift tax) will be based on the market value. No idea how they value a property; we'll all find out this year.

Jim's point about avoiding possibility of higher prices - one must also worry possibility of higher CGT and lower thresholds in future budgets.
 
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