Transfer of land from parent to child

shivermetimber

Hi there,

My parents have offered me some land with a view to a future home there. I am just wondering if anyone has any up to date information or experiences with the transfer process of land from parent to child and any details of the various costs to both parties involved.

Details are: Site would be under 1 acre and is part of farmland currently used for small scale horse breeding. No other animals or crops. Site does not have road access but is beside one so easy to do.

Also it could be a few years before it's possible to build a house, who knows. Some have said maybe getting planning permission is better before the transfer so I know about the possibility of the site but surely this would expire by the time that comes? Should I just transfer and cross that bridge later. This is the point I'm most unsure of.

Thanks in advance for any advise offered.

johne101

I would just transfer the property/land. If it is part of an existing holding you may require an engineer to draw up new maps for the new site to facilitate the transfer.

Planning is notoriously difficult to get your hands on this weather across the country for sites, particularly in more rural locations. You may be required to prove residential need etc, however if you are not building soon this is not a concern for today as these planing guidelines could be different when you do build.

Also if you transfer a site with planning it would have a higher inherent value thus either eroding a greater portion of your inheritance threshold from your parents or if you have already expired this it will incur a larger portion of inheritance tax. In order for the transfer I do believe you will require a valuation from a register valuer in order to facilitate the Revenue aspect of things.

shivermetimber

Yes, it will need new maps drawn up but luckily my dad has some experience in this dept from his time as a civil servant so he can possibly help with this or know someone who can. Good point about planning before transfer, thanks. Regarding future planning the land is only a 2km from the center of a 10-15k population town but not sure whether that is good or bad.

Any ideas on the process itself and how this goes from start to finish and the costs involved throughout?

4ensic15

With the new building regulations it is not economic to build a new house on a site. It is cheaper by far at the moment to buy an existing house. You should tell your parents to keep their field. If they want to help you out they should give you a deposit for a house in the town.

shivermetimber

No offense but your reply does not address anything from my original post. I'm not looking for advise on building vs buying, just on land transfer and the processes and costs involved for now. Thanks for looking in though.

4ensic15

4ensic15 wrote: »

With the new building regulations it is not economic to build a new house on a site. It is cheaper by far at the moment to buy an existing house. You should tell your parents to keep their field. If they want to help you out they should give you a deposit for a house in the town.

Nonsense of the highest order. It's not that difficult to get planning bar one or two counties with power hungry planners ( I've double figure numbers of friends building one off houses at the moment or built in the last year) and the regulations are not that stringent. If you have a free site you will build a far superior house for less or a similar cost to buying, and that if you buy in the same area as you build which may not be an option. Go close to a town or city and you will get a far smaller, inferior house not built to your requirements and pay far more.

Sponsorgate

Slightly off topic, what do I need to transfer a site from my father to me?

I have planning permission on the site & I also have the site valued by an auctioneer. Is there anything else I need to take to my solicitor?

Ri_Nollaig

shivermetimber wrote: »

Hi there,

My parents have offered me some land with a view to a future home there. I am just wondering if anyone has any up to date information or experiences with the transfer process of land from parent to child and any details of the various costs to both parties involved.

Details are: Site would be under 1 acre and is part of farmland currently used for small scale horse breeding. No other animals or crops. Site does not have road access but is beside one so easy to do.

Also it could be a few years before it's possible to build a house, who knows. Some have said maybe getting planning permission is better before the transfer so I know about the possibility of the site but surely this would expire by the time that comes? Should I just transfer and cross that bridge later. This is the point I'm most unsure of.

Thanks in advance for any advise offered.

I did a similar thing about four years ago and have been living in my house for well over the past year. It is definitely worth it, once you are happy living in the area and the site location etc.

I would get planning on the site before any transfer. An argument could be made to do the transfer before, as land without planning would only have agricultural value [~10k per acre] rather than a site with planning, which could easily be x10 that.
You have to pay gift/inheritance tax [CAT] but there is allowances for transfers between parents to children etc. Full details here http://www.revenue.ie/en/tax/cat/gift-inheritance.html.
But if its zoned/restricted etc it might greatly affect its value and therefore the amount of CAT due on it.
So in all likelihood you wont have to pay an CAT anyway, perhaps it would be best to get a valuer to estimate the cost before and after and work out if its best. Can't remember if you have to pay stamp duty, if you do that is 1%.

So to handle all the above you will need a registered valuer, maybe an engineer to both mark up the site, do a house design and submit the planning and finally a solicitor. It has to be a different solicitor to your parents as otherwise it would be a conflict of interest.

It will probably cost in and around €2-3,000 between all the professional costs and maybe another €1,500 if you are going to pay for your parents solicitor's fee too as they will charged as well, just fyi.

As for getting planning, if you are form the area and "in need of housing" i.e. don't already own a house and follow whatever guidelines the local area has, you shouldn't have much trouble. Takes three months. If, for whatever reason you can't get planning there atleast you didn't transfer it yet!

Ri_Nollaig

Sponsorgate wrote: »

Slightly off topic, what do I need to transfer a site from my father to me?

I have planning permission on the site & I also have the site valued by an auctioneer. Is there anything else I need to take to my solicitor?

Nope, probably not. The solicitor [can't be the same as your fathers] will ask for whatever else is needed, Land registry etc and will complete all that as part of the land transfer. Will want maps etc but you probably already have that from your engineer due to the planning.

shivermetimber

Thanks for the info Ri Nollaig! Happy with location etc, nothing to worry about there. We were discussing this over the weekend and also thought that maybe planning before transfer was the wiser choice as that way if it does fall flat on its arse for whatever reason the transfer is not done. My father could apply based on sibling in need of housing and care for parents etc as you say.

You do say the same but also that it's best to keep the transfer value as low as possible for CAT but surely transfer after planning has the value raised significantly and this would work against us? Could you clarify what you meant there?

Ri_Nollaig

shivermetimber wrote: »

You do say the same but also that it's best to keep the transfer value as low as possible for CAT but surely transfer after planning has the value raised significantly and this would work against us? Could you clarify what you meant there?

Sorry, I made a bit of mess of that point.
Basically, you might need to weight up the risk of not getting planning versus the additional CAT that you would be liable to pay if you did.

But obviously due to the reliefs you get, I assume you wont be paying any CAT anyways? Also, if the site is limited in access/services etc it can be valued lower but I would assume any site in the country is probably worth €40-50k min unless its on the side of a mountain or something.

In short, I think the first port of call should be a good solicitor who can advise on the best course of action. No matter what you do, you will need one anyways so may as well sort that first.

shivermetimber

Thanks for the clarification, reckoned as much but just wanted to be sure.

shivermetimber

Another quick question on this. If the above goes ahead and planning is done before transfer do I then have to pay stamp duty on the site or is it still exempt due to the parent sibling transfer?

Mr. Incognito

You really should engage a solicitor and ask him these quetions.

shivermetimber

Mr. Incognito wrote: »

You really should engage a solicitor and ask him these quetions.

I hear ya but I'd prefer to garner knowledge from here first though in case anyone knows. Sure what's the harm in asking, that's what forums are for :pac: