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Gift Tax? - Profit made from sale put in to new house build with partner

  • 20-01-2020 01:35PM
    #1
    Kildare263
    Registered Users, Registered Users 2 Posts: 18 ✭


    Hi

    I am currently in the process of selling my house which i built years ago (in my name) and stand to make a profit. My partner and i (not married) are currently looking to build - we have a site in mind subject to planning so our plan is to buy the site, put the money i make in to building the new house and getting a small mortgage for the balance. I have read online that as i will be making a bulk contribution towards the build that we will have to pay gift tax. Do you know if this is correct or are there any other solutions?

    Thanks


Comments

  • #2
    Calahonda52
    Registered Users, Registered Users 2 Posts: 13,207 ✭✭✭✭Calahonda52


    It depends on the ownership of the new build, including the site AND the status of your relationship with your partner.

    https://www.revenue.ie/en/gains-gifts-and-inheritance/cat-exemptions/exemption-on-transfers-between-spouses-or-civil-partners/index.aspx

    Exemption on transfers between spouses or civil partners
    If you receive a gift or inheritance from your spouse or civil partner, that gift or inheritance is exempt from Capital Acquisitions Tax (CAT).
    .
    If you are not married and don't have civil partner status, your partner will the liable for CAT if you in effect gift her half the site/house by way of joint ownership

    “I can’t pay my staff or mortgage with instagram likes”.



  • #3
    scheister
    Registered Users, Registered Users 2 Posts: 1,312 ✭✭✭scheister


    Kildare263 wrote: »
    Hi

    I am currently in the process of selling my house which i built years ago (in my name) and stand to make a profit. My partner and i (not married) are currently looking to build - we have a site in mind subject to planning so our plan is to buy the site, put the money i make in to building the new house and getting a small mortgage for the balance. I have read online that as i will be making a bulk contribution towards the build that we will have to pay gift tax. Do you know if this is correct or are there any other solutions?

    Thanks

    How the house is split will be the main issue. If the house is split 50/50 there is a gift element. On the other hand

    If you are putting 200k cash into the house and getting a joint mortgage for 200k. If the deeds show the house as 75% you and 25% your partner there would be no gift element. Not sure if the bank would be happy with this idea.


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