UK Capital gains tax/gift on residential property

May 7, 2024
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United Kingdom
In 2010 my wife and I decided to purchase a property at auction. The property was bought for around £140,000 and was put jointly in my wife and my son's name. (A couple of years later my son took his name off the title for personal reasons so since that date the property has been in my wife's name). Initially, the ideal was to renovate and sell the property but due to the property market at the time the property was difficult to sell and we decided to rent the property for 6 months after it had been renovated at a cost of around £30,000. We rented the property to a good tenant who rented it for 2 years and immediately after that tenant left another person wanted to take over the tenancy. They have remained as a tenant in the property for around 10 years. The rent received ha been declared as income over the full period of the tenancy but the £30,000 for the cost of renovations has not been claimed against tax in any way (this figure goes back to around 2011). My wife is now at the stage where she does not want to have the property in her name and is considering selling it but an acquaintance suggested that she gift it to me and said if she did there would be no CGT on the gift transfer and if sold by myself in the future I would only pay CGT of the gain from the date of gift transfer. (I would estimate the value of the property to be around £300,000 now).

I have a few questions

1) Can my wife gift transfer the property to me without having to pay CGT and will I have any tax of any form to pay at the time of transfer?
2) If the property can be gifted to me and I eventually sell it will I just pay CGT on the gain from the date of transfer to the date of sale?
3) If the property cannot be gifted to me without a CGT liability can the £30,000 renovation costs be set off against CGT due?

Many thanks in advance for any replies to the above

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