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Do You Pay Stamp Duty on a Gifted Property?

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When it comes to inheriting or receiving a property as a gift, one of the most pressing questions that arises is whether you need to pay stamp duty on the gifted property. This is an important aspect to consider, especially if you’re looking to avoid any additional financial burdens.

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What is Stamp Duty?

Stamp duty is a tax levied by the UK government on the purchase of properties. The amount of stamp duty payable varies depending on the property’s value and the buyer’s circumstances.

Typically, stamp duty is paid by the buyer, but in the case of a gifted property, the rules are slightly different.

Do You Pay Stamp Duty on a Gifted Property?

The good news is that you do not pay stamp duty on a gifted property if the gift is made without any consideration, meaning there is no payment or other form of compensation involved. This is because HMRC does not consider a gifted property to be a “chargeable consideration,” which is the term used to describe a transaction that attracts stamp duty.However, there are some exceptions and additional factors to consider:

  1. Part-Gift, Part-Purchase: If you receive a property as a part-gift and part-purchase, you will need to pay stamp duty on the portion you are purchasing. For example, if a parent gifts you 50% of a property and you purchase the remaining 50%, you will pay stamp duty on the 50% you are buying.

 

Table: Stamp Duty Rates in the UK

Property ValueStamp Duty Rate
£0 – £125,0000%
£125,001 – £250,0002%
£250,001 – £925,0005%
£925,001 – £1,500,00010%
Above £1,500,00012%

 

Additional Factors to Consider

  • Inheritance Tax: While you may not pay stamp duty on a gifted property, you may still be liable for inheritance tax if the property is worth more than the nil-rate band (currently £325,000).
  • Capital Gains Tax: If you decide to sell the gifted property in the future, you may be subject to capital gains tax on any profit made.

Pros of Selling with Property Saviour vs Cons of Selling via an Estate Agent

If you find yourself in a situation where you need to sell a gifted property quickly, consider the following advantages of working with Property Saviour:

 

Pros of Selling with Property Saviour:

  • Fast Sale: We can complete the sale within 10 days or at a timescale that suits you.
  • No Estate Agent Fees: You save on agent commissions, which can be substantial.
  • No Surveys or Valuations: We don’t require surveys or valuations, saving you time and money.
  • Guaranteed Price: We honour the agreed price and never lower it before the exchange of contracts.
  • Legal Fee Contribution: We contribute at least £1,500 towards your legal fees.

 

Cons of Selling via an Estate Agent:

  • Slow Process: Selling through an estate agent can take months, even years.
  • High Fees: Agent commissions can eat into your sale proceeds.
  • Surveys and Valuations: You may need to pay for surveys and valuations, adding to your expenses.
  • Price Negotiations: Agents may pressure you to lower the price, reducing your sale proceeds.
  • Legal Fees: You’ll need to cover the full cost of legal fees.
Do You Pay Stamp Duty on a Gifted Property
The good news is that you do not pay stamp duty on a gifted property if the gift is made without any consideration, meaning there is no payment or other form of compensation involved.

Is the Trade-Off Worth It?

At Property Saviour, we understand the complexities of dealing with gifted properties and are here to help you through the process. Contact us today to discuss your options and ensure a smooth, hassle-free sale.

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