Gifting a property to your family member might not be as simple as it sounds. Even when inheriting a property, several legal aspects need to be kept in mind. You will have to sign a new transfer deed for every transfer of property (be it buying or gifting). Several clients ask for advice on transfers of property to avoid or reduce the amount of taxes that they might have to pay.
Who considers a voluntary transferring of property?
Several people might be wanting to opt for a voluntary transferring of their property. A civil partner or a spouse might want to transfer their property to their husband or wife, or one of the spouses might want to own the property solely. Thus, you might wish to transfer the property from individual ownership to joint ownership.
Ideally, you should reach out to experienced solicitors who can provide you with the correct advice on matters such as transfers of property, a solicitor would tell you the advantages of joint home ownership. It will allow your partner or spouse more legal rights to the property in the unfortunate event of the death of one of you.
What are the implications of transferring property by inheritance or as a gift?
Whenever a property transfer occurs as a gift, you should note the various tax implications like capital acquisitions tax, stamp duty, capital gains tax, etc., that can arise because of the transaction. You should also not forget that property transfers might result in tax implications for a lifetime for the person who is gifting/transferring the property.
As per the current laws, a person will not need to pay the capital acquisitions tax if the transfer of property takes place as a gift or due to the death of the other spouse. Similarly, no stamp duty is required for transfers of property between spouses.
Apart from the financial implications, there could be several other consequences as well. You should make an informed decision before deciding on a transfer of property you own. As a rule, you must ensure that the person you gift your property to is a person you trust.
Additionally, depending on the property you are using, you might end up losing some state benefits as well. Thus, reach out to the best solicitor in your area before making a final call on transfers of property to make an informed decision.
What are some closing provisions on transfers of property?
As per the recent modifications in the law, the buyer will make the transfer deed. In case the deed is not agreed upon at the time of signing the contract, a draft needs to be submitted to the buyer's solicitor within seven days of signing the contract. It is essential to have a solicitor to guide you in such situations.