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Advice: What are the key tax implications of gifting a site to a family member?


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Site issues: The taxes that can arise when gifting a site to a family member are Capital Gains Tax, Gift Tax and Stamp Duty

Site issues: The taxes that can arise when gifting a site to a family member are Capital Gains Tax, Gift Tax and Stamp Duty

Site issues: The taxes that can arise when gifting a site to a family member are Capital Gains Tax, Gift Tax and Stamp Duty

Seldom does a week pass that I do not get a query from a farmer about the matter of gifting a site to a family member and the possible tax implications of doing so.

The family member could be a son, daughter, brother, sister, niece or nephew and the taxes that can arise are Capital Gains Tax, Gift Tax and Stamp Duty. The relationship to the person getting the site will generally determine if a tax exposure exists for any of the parties involved and what the nature of the tax exposure will be.

Most people have the impression that there will be no tax implications for gifts and that is generally true in the case of transfers to children, but transfers to other related parties may not be quite so simple. Indeed, even parent-to-child transfers are subject to strict rules which if not observed could land a tax liability back at the door of the son or daughter who received the site.