My husband and I bought a house to rent to our daughter. When she decides to move on we have told her that any profit made from the sale she can use towards a deposit on her own first home purchase. Can you advise me of the tax implications of this please both for us and our daughter. This property is the only uk property we own as we took early retirement and currently live in Gran Canaria . The rent she pays monthly is declared on our annual tax return
If you make a profit on the sale of the property then a capital gain would arise. Tax would be due if your share of the gain exceeded the annual allowance. If you jointly own the property with your husband then you should each calculate the gain on your half share of the property.
If you are not resident in the UK when the property is sold you should report the details to us within 30 days of completion of conveyance.
The money you give to your daughter would be treated as a gift and there would be no income tax implications for you or your daughter. However, you should see the following link about gifts and inheritance tax