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| *Ostroff, Fair and Company>>>United Kingdom Taxes |
I want to transfer my house over to my 2 daughters. How much tax would I/they have to pay. Thank you? |
I want to transfer my house over to my 2 daughters. How much tax would I/they have to pay. Thank you? If you live in California, I wouldn't... They would be TAXED to death. First, do the MATH. What I mean is, learn what all of the costs would be to do the transfer and what taxes would be due, and what property taxes would have to be paid. You might find that your 2 daughters can't afford the house, and everyone would be a loser. Always start with an attorney. I think they would not have to pay tax if they are living in it but if they are not it will come under inheritanse tax I think when you die if you are the only one living there then it counts as inhearitance for up to 6 years after you give it them I think if you stay alive for 7 years no tax, if you die before that it depends how many years you lived. If you stay alive for 7 years there is no inheritance tax. If you die within 7 years the gift is considered inheritance and can be taxed up to 40percent. This is to stop people giving everything away before they die to avoid the government getting all their hard earned cash. SO DO IT QUICK. Previous answers near the mark, but capital gains tax applies if the seller does not live in the property when selling - not sure of the length of time that applies....... Clever and common way to avoid tax, if you stay alive for 7 years no tax due!!!!! Woo Hoo lets beat the tax man for a change! First the good news - no income tax on gifts so they wouldn't pay any of that. And no Stamp Duty Land Tax if there is no payment. However...... 2 potential taxes: 1. Inheritance tax - if you survive seven years after the gift there should be no tax BUT you have to be really careful. If you continue to live in the house then it would still be deemed to be your property for inheritance tax purposes and it would be taxed when you die. 2. Capital gains tax - a gift is a 'disposal' for tax purposes and a gain will have to be calculated based on the assumption that you sold the property for its market value (despite the fact that you are actually gifting it). If you have lived in the house since you bought it this will exempt the gain though. Complex area - best way is to gift, and pay rent to daughters if you continue to live there. That means that they'll have to pay tax on the rent though! |
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