My parents own a small factory which they would like to pass to me now. Their estate I believe is over the £2 million mark (don’t know, haven’t asked) but definitely over the £1 million as their house is about 900k ish. The factory is worth 200,000 and they bought it 20 years ago for 100,000.
My dad has cancer and is expected to have around 2 years left. My mum is healthy but 79. They own the factory via a company which they have equal shares in.
So my question is - can my dad gift the shares to my mum now, and my mum then gift the shares to me? I’m a bit hazy on the CGT but I think if he gifts his share, that “resets” the value to 220,000 so there is no CGT payable on that first transfer. And because it’s between spouses, there’s no tax anyway.
Then if mum transfers her shares to me, there’s no CGT as there’s no “gain” and I pay inheritance tax if she dies within 7 years.
But have I missed a taxable event earlier?
I am happy to pay CGT and stamp duty because I think that would be lower in any event than any potential IHT.
They have asked their tax accountant but I have to say, I’m not sure her advice is correct in terms of IHT as she has said we should wait until my dad dies, then my mum will inherit the share and then she can pass this to me.