• Subject: Transfer Of Equity Tax Question

    By Guest on 29th Sep 2016

    Subject: transfer of equity tax question

    10 years ago my dad transferred the ownership of his house to my brother and myself (half share each). At the time the house was worth approximately £50,000.

    Our dad remained living in the house until unfortunately he has recently moved in to a care home, and there is no prospect of him returning to live in the house.

    The house has just been valued at approx £120,000.

    What are the tax implications (including stamp duty and capital gains tax) if:

    - We arrange, via a transfer of equity, for me to have full ownership of the house in return for me paying my brother £60,000 (and I then rent the house out for approx £600 per month);

    - or we sell the house and split the price received between us?

  • 1 Answers

    By Guest on 21/11/2016

    I'm not a tax expert and can't advise on any CGT your brother would have to pay however as for SDLT, you will pay duty on £60,000. If this is the only property you own you will pay at the standard rate, so 0% up to £125,000 i.e. you will pay nothing. If you own 1 or more other properties however you will pay the new higher rate of 3%, so you will pay £1,800. It doesn't appear to matter that you already own half of the property. Of course, you would need to pay income tax on on the rental income as well.

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