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Can my husband and I transfer the ownership of our second property to our daughter without incurring capital gains tax?
My husband and I have a second property - can we sign a Deed of Transfer to transfer the ownership into the name of our daughter who is now 18 without incurring capital gains tax? The property is currently rented out and has financed her education for the past 7 years since acquiring the property when her grandparents died. The property would have been put in her name 7 years ago but we were told she had to be 18 before she could legally own it?
As the property is not your principal residence it is likely that the issue of capital gains tax could arise, for which there is an annual relief for individuals for the tax year 2007/8 of £9,200 and for the tax year 2008/9 of £9,600.
You are of course entitled to take off the gain any costs associated with the ownership of the property including mortgage interest, maintenance, repairs, insurance etc so that you end up with a net “profit or gain”.
This is of course a complex area and the issue of actual tax liability should be considered if you decide to continue with the transfer.
To transfer the property, assuming there is no mortgage, would cost £250 plus VAT together with any associated Land Registration fees and searches.
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