obtaining a site from family

Dave M203

Hello

Just wondering whats the procedure in getting a site from a family member? Is it just a case of solicitors signing off on a contract?

Kind Regards

D

bee06

Both parties need a solicitor to take care of the legal transfer. If the land is part of a wider folio you'll need someone to make out the land being transferred, we used the architect designing our house and depending on the familial relationship, the value of the land and how confident you are with revenue related stuff an accountant to advise on the tax implications.

Dave M203

Very good, tax implications in what way, my father in law has stated he will give half an acre to my wife....we have it marked out so is it just both solicitors need to get it transfered on signing by both parties....

bee06

Potentially capital gains and capital acquisitions tax might apply. There are exemptions and thresholds that may limit or eliminate any tax but it still needs to be looked into and declared.

Calahonda52

Disposal by father, possible cgt issues.
Acquisition by daughter, prolly no cat issues as prolly less than 225 k in market value.
New maps required.
Land need to be registered in land registry.
Revenue wilk query valuation if it looks fudged

Effects

Calahonda52 wrote: »

Acquisition by daughter, prolly no cat issues as prolly less than 225 k in market value.

Transfer will reduce the wife's CAT allowance from her father which might have problems further down the line.
Transferring the land before PP is obtained also means it's worth less.

Calahonda52

Effects wrote: »

Transfer will reduce the wife's CAT allowance from her father which might have problems further down the line.
Transferring the land before PP is obtained also means it's worth less.

Agreed, but Revenue are now looking at this method and I have had a few cases where the Revenue invoked the Development land option in the negotiations to drive up the transfer price.
No tax is paid, but more of the CAT allowance is used up

Effects

Can you explain that a little more? I'm currently looking at a plot from a family member and transferring it before permission is granted. It's a tight plot for a mews and the land obviously isn't worth the same amount to someone else as only a family member would be allowed to build on it.

stickybookmark

Dave M203 wrote: »

Hello

Just wondering whats the procedure in getting a site from a family member? Is it just a case of solicitors signing off on a contract?

Kind Regards

D

I got a site from my parents. Had it valued after I got planning permission (you're taking a risk getting it transferred first and going for planning after as you mightn't get permission in which case the site is useless and your wife has wasted some of her tax-free-allowance on a useless site)

I had to get an auctioneer to value the site.

Both sides have to engage a solicitor (they can't be the same one) and I also got the guy that got planning for me (arch tech) to order the land registry map and mark out the site on it. He charged me 30.75 for purchase of the land registry map and 75 for his fee. The solicitor was looking for 'land registry compliant maps' so as my site was complex (spanning 2 folios) I just found it easier to get him to do it

Stamp duty had to be paid that was 2% of the auctioneers valuation. (this used to be 1% as there was a consanguity relief but that was abolished in one of the recent budgets)

CAT/Gift tax applies but as long as your wife hasn't received other substantial gifts she can receive up to approx 230k without having to pay this tax.

CGT will be exempt as parents are providing a site to their child on which their child is going to build a home for themselves.

For me the stamp duty was 500 euro and the solicitor's fees were 1400 (inc VAT) I don't know how much the solicitor's fees on my parent's end was.

We both had to sign papers. I signed, scanned and emailed and my parents went into the solicitor to sign.
Hope that helps.

mjj

stickybookmark wrote: »

I got a site from my parents. Had it valued after I got planning permission (you're taking a risk getting it transferred first and going for planning after as you mightn't get permission in which case the site is useless and your wife has wasted some of her tax-free-allowance on a useless site)

I had to get an auctioneer to value the site.

Both sides have to engage a solicitor (they can't be the same one) and I also got the guy that got planning for me (arch tech) to order the land registry map and mark out the site on it. He charged me 30.75 for purchase of the land registry map and 75 for his fee. The solicitor was looking for 'land registry compliant maps' so as my site was complex (spanning 2 folios) I just found it easier to get him to do it

Stamp duty had to be paid that was 2% of the auctioneers valuation. (this used to be 1% as there was a consanguity relief but that was abolished in one of the recent budgets)

CAT/Gift tax applies but as long as your wife hasn't received other substantial gifts she can receive up to approx 230k without having to pay this tax.

CGT will be exempt as parents are providing a site to their child on which their child is going to build a home for themselves.

For me the stamp duty was 500 euro and the solicitor's fees were 1400 (inc VAT) I don't know how much the solicitor's fees on my parent's end was.

We both had to sign papers. I signed, scanned and emailed and my parents went into the solicitor to sign.
Hope that helps.

Hi stickybookmark,
Just a quick question for you, my boyfriend and I are building a house. His dad gifted him a site. It was transferred from father to son and it falls under the exemption you mentioned and he is under the CAT limit. It's all be done and everything is fine. I'm just wondering if we need to do anythin regarding revenue, do we need to inform them of anythin even though there are no CGT or CAT implications? Thanks!

stickybookmark

mjj wrote: »

Hi stickybookmark,
Just a quick question for you, my boyfriend and I are building a house. His dad gifted him a site. It was transferred from father to son and it falls under the exemption you mentioned and he is under the CAT limit. It's all be done and everything is fine. I'm just wondering if we need to do anythin regarding revenue, do we need to inform them of anythin even though there are no CGT or CAT implications? Thanks!

I assume there were solicitors involved?
The solicitors take care of all revenue aspects, no need for you to contact revenue separately

mjj

stickybookmark wrote: »

I assume there were solicitors involved?
The solicitors take care of all revenue aspects, no need for you to contact revenue separately

Yes there were solicitors involved! That's good to know, I just wanted to make sure! Thank you!

SuperO'B

This is interesting as I am in a similar situation with GF's parents supplying a site which she should get planning on as she's from the area. If the site is transferred to her name then will the bank allow a mortgage in both our names on land in one name? If the land is transferred to both our names then will I have to pay Capital gains tax whereas she will be exempt as it's a gift from her parents?

Sorry for hijacking but would assume it would also be relevant to the OP somewhat.

stickybookmark

SuperO'B wrote: »

This is interesting as I am in a similar situation with GF's parents supplying a site which she should get planning on as she's from the area. If the site is transferred to her name then will the bank allow a mortgage in both our names on land in one name? If the land is transferred to both our names then will I have to pay Capital gains tax whereas she will be exempt as it's a gift from her parents?

Sorry for hijacking but would assume it would also be relevant to the OP somewhat.

This is not the question you asked but with planning permission that has to be done in your GF's name alone as she is the family memeber and the one with a ''housing need'' as far as council is concerned. I would also advise transfer of the site to her name alone for tax reasons.

I don't see why a bank wouldn't give ye a mortgage in two names with the site in just one. But maybe it depends on the bank. In a joint mortgage both parties are jointly and severally liable for the mortage i.e. if one person can't or won't pay their half, the other person is liable for the full amount. So I'd imagine it wouldn't matter who's name the asset is in as both names are going on the mortgage.

Calahonda52

stickybookmark wrote: »

The solicitors take care of all revenue aspects, no need for you to contact revenue separately

I don't know what is meant by the above but CGT and CAT are both self assessment taxes so there is still a need to make a return for CGT and CAT if within I think, 80% of the threshold limit, in accordance with the relevant time frames for such returns.

mjj

Calahonda52 wrote: »

I don't know what is meant by the above but CGT and CAT are both self assessment taxes so there is still a need to make a return for CGT and CAT if within I think, 80% of the threshold limit, in accordance with the relevant time frames for such returns.

Do you need to make a return even if the transfer falls under an exemption for both CGT and CAT?
Thanks!

mjj

SuperO'B wrote: »

This is interesting as I am in a similar situation with GF's parents supplying a site which she should get planning on as she's from the area. If the site is transferred to her name then will the bank allow a mortgage in both our names on land in one name? If the land is transferred to both our names then will I have to pay Capital gains tax whereas she will be exempt as it's a gift from her parents?

Sorry for hijacking but would assume it would also be relevant to the OP somewhat.

Not all banks will do joint mortgage/sole title mortgages but ulster bank will and I think Bank of Ireland do in certain circumstances. Get in touch with them and see what they say.

paddysdream

SuperO'B wrote: »

This is interesting as I am in a similar situation with GF's parents supplying a site which she should get planning on as she's from the area. If the site is transferred to her name then will the bank allow a mortgage in both our names on land in one name? If the land is transferred to both our names then will I have to pay Capital gains tax whereas she will be exempt as it's a gift from her parents?

Sorry for hijacking but would assume it would also be relevant to the OP somewhat.

Had this exact same problem years ago.
Basically site was part of farm transferred to me about 1 year before starting to build.Solicitor said to leave it in my sole name as to transfer it into joint names would cost(I think;a good few years ago now!) approx 5k between revenue etc.Farmland etc was transferred to me as an eligible farmer so Ag. relief etc applied.
We applied and got mortgage approval with bank which I had dealt with since leaving school.
They then decided as mortgage was in joint names they would require site to be the same.No leeway whatsoever.
Back to solicitor and he told me the cost involved so decided to try other banks.
One bank gave mortgage dependent on us giving undertaking to transfer site into joint names after 7 years.
They wrote a few times after 7 year period and eventually we put the actual site into both our names.Think it could have been maybe 10 to 12 years after initial mortgage taken out.
They were not really pushed but wrote maybe once a year to both us and the solicitor so eventually we decided to do it as cost was minimal at this stage.

amrt

Sorry I am just wondering if someone could offer me some light on the subject of site transfer. We have just got planning permission on a site gifted to me by my father. The site is valued at around €40k we have not had it officially valued yet. Myself and my boyfriend applied for planning in both our names as we were advised to do so by our engineering and the mortgage will be in both our names (that's been processed at the moment) I am just wondering what tax we are liable to be paying on the site especially my boyfriend?

BryanF

http://www.boards.ie/vbulletin/showthread.php?p=100198604