SHORTER READ

Probate & UK trusts, tax and estate planning

Q&A: My father has left his home to me and my siblings. What will it cost to buy out my siblings?

SHORTER READ

James Cook answers a reader’s question in The Sunday Times.

1 minute read

18 April 2019

SHARE

Authors

James Cook

Partner

Talk to James about UK trusts, tax & estate planning & Probate & Wills & succession planning

Stamp duty land tax (SDLT) will most likely be payable if you buy out your siblings’ shares of your father’s property. For example, if the home is worth £1m and your siblings’ shares total £750,000, the liability would be £27,500. SDLT is calculated on a sliding scale, with no charge on the first £125,000, 2% on the next £125,000, 5% on the next £675,000, 10% on the subsequent £575,000 and 12% on the portion over £1.5m. If you already own a residential property, an extra 3% SDLT would be added, so the total stamp duty in this example would be £50,000.

Capital gains tax (CGT) might also come into play, at a rate of 18% or 28% (depending on your income-tax band), although this would be levied on your siblings, not you. All the children would be deemed to have acquired the property at the date-of-death value, but your siblings would be liable for CGT if there had been any increase in value following your father’s death on their respective shares, less their annual CGT exemptions (£11,300 for 2017-18 and £11,700 for 2018-19). In a slow pre-Brexit property market, there might be little or no gain in value to be taxed.

First featured in The Sunday Times on 10 Feb 2019.

18 April 2019

Authors

James Cook

Partner

View profile

SHARE

Related content

Latestfromtheteam

View all

MoreofJames'sInsights

View all

You are contacting

James Cook

Partner

james.cook@collyerbristow.com



    Subscribe

    Please add your details and your areas of interest below

    Specialist sectors:

    Legal services:

    Other information:

    Jurisdictions of interest to you (other than UK):

    Article contributor

    FINDING OUR ARTICLES OF INTEREST? SUBSCRIBE TO RECEIVE THE LATEST CONTENT DIRECT TO YOUR INBOX

    Subscribe now
    Get In Touch Print this page
    Collyer Bristow
    < back to Updates
    < Back to What we do
    < Back to What we do
    < Back to What we do
    < Back to What we do
    ExpandNeed some help?Toggle

    < Back to menu

    I have an issue and need your help

    Scroll to see our A-Z list of expertise

    Get in touch

    Get in touch using our form below.