Tax Exemption for Dwelling House - CAT 10

nick.harris

Scenario:

A property has already been gifted by a father to his daughter which fulfilled all the conditions of exemption i.e. inhabited as primary residence for 3 years etc.

After the initial gift the father now has a new property that the daughter has occupied for a further 3 years and would like to gift this house as a kind of swap for the original gift/house.

Can this be done under the exemption?

If not, what would be the best way to transfer ownership or sell the new property to the daughter?

The value of the new property exceeds that of the original property.

Lockedout2

Talking hypotentically a gift of a house to someone who lived in it for three years qualified for exemption from CAT, where that person continued to live in the property for a further 6 years.

So assuming that she has lived there for 9 years that gift is fine. Now the rules have changed and the dwelling house exemption is limited.

silent_spark

As far as I gleaned from a quick reading of an article in the SBP last week, the new rules in place mean that the property owner can now only gift their principal private residence, not any random property, and that it must be to a relative who has been living there with them. The same three-year and six year criteria apply.

nick.harris

Lockedout2 wrote: »

Talking hypotentically a gift of a house to someone who lived in it for three years qualified for exemption from CAT, where that person continued to live in the property for a further 6 years.

Thanks for the reponse.

I guess with the new legislation a second gift is out of the question as no dependants are involved.

If she was gifted the original house and has not yet completed the 6 year period after that and sells the house to fund the purchase of another primary residence would the exemption still be valid for the original gift?

The original gift was prior to the changes in legislation in Dec 2016

silent_spark

nick.harris wrote: »

Thanks for the reponse.

I guess with the new legislation a second gift is out of the question as no dependants are involved.

If she was gifted the original house and has not yet completed the 6 year period after that and sells the house to fund the purchase of another primary residence would the exemption still be valid for the original gift?

The original gift was prior to the changes in legislation in Dec 2016

I can't imagine the full exemption would be valid if the six year rule wasn't complied with (otherwise why have it?). It was introduced to protect those in danger of losing their home due to having to sell the property to pay the CAT in the first place. Maybe there's a claw back option?

Lockedout2

Is the daughter living in her gifted house and the fathers new house at the same time?