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Selling my house to my son

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Ric.ror | 11:22 Fri 05th Oct 2012 | Business & Finance
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Not sure if this is the right place to post this - so please bear with me.
I intend to sell my second house to my son.
I moved out on 3 Dec 2009 and he moved in later the following year - it was empty during this time. He now wants to buy the house - so obviously I would like it sorting before 3 Dec 2012 - to avoid the CGT.
Do I need to inform anyone and will I have to pay any other kind of tax or revenue?

Many thanks in anticipation
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has it even increased since 2009? you probably haven't even made a capital gain
Make sure he pays the going rate for the house or there may be tax problems later.
Question Author
Thats what I mean VHG - why will there be tax problems?
I was only going to ask two thirds of the going rate
Potential issues:

CGT: should be avoided on the final 36 months of ownership (you clearly seem to know this). Not payable during your occupation prior to that, provided it was your pricipal residence (can claim Principal Residence Relief applies).

IHT: potentially an issue should you die in the next 7 years your estate would otherwise be above the nil rate band; assets given away in the 7 years before one dies are treated as if IHT is still payable on them (a sliding scale on time applies).

Stamp Duty Land Tax: paid by the purchaser (your son) on the purchase sum. Could be various cop-outs if he's a first time buyer? but otherwise unavoidable.
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Thank you for your answers

He is a first time buyer - I wonder if its best to ask for the full amount and give him back the 33% as a gift - but then he does not have a deposit - he is going to see the bank tomorrow to discuss how much he can raise but we thought they would take into consideration the fact he is getting it so cheaply
You'll have to check the current rules on 1st time buyers - I thought the previous moratorium up to £250k was now passed but that it was Labour (who mercifully are not in Government) that are saying they would reintroduce it.
Ric I can't advise you on this and to be honest it is a bit of a minefield with every case different obviously....so many rules and laws that the only sensible advice would be professional advice...

lol...you might not like some of his answers which could mean costs that you hadn't considered but far better to get it all done with...don't want nasty big bills from the IR after a few months or years...;-)
i would do as you suggest and pay full price and give im back the 3rd in private.. that way there can be no accusations etc
i would be carful, i may be wronf but i remember reading something about inheritance tax and people trying to avoid it by giving a house or selling it cheap to their children, as long as its at market value you should be fine
I can't see what possible merit there is in selling the house at full value and returning a third of the price as a gift? There's no CGT relevance here for you anyway as long as you sell it by 3rd December. There is an IHT relevance but there would be for the gift back too so you'd be no better off. And in any event unless you die within seven years it would be irrelevant anyway. Even if you do die within seven years the tax liability is caled back by a seventh each year.

There are also presumably stamp duty implications on the higher house purchase price.

On the lower sale price your son will be sitting on a bigger capital gain but as he lives in the house he'd be exempt from that anyway.

As I say I can't see any merit on not charging him whatever you like.

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