buying a house -lower sum than agreed + cash payment to help owner avoid capital gains?

[RanToTheHills]

is this legal?
Had offer accepted on house but now current owner has been advised that she'd be liable to large sum in capital gains if they sell at agreed price. They may probably pull out now and rent it instead. We want this house! We're wondering what (legal) ways we can get round this -can we make them a cash payment on top while officially paying them a lower amount (IFYKWIM?)
Hope this makes sense!

Of course it's not legal.

You can lower it by paying some for the fixtures and fittings seperately but this does have to be a reasonable split. This is a trick used to avoid the higher bracket stamp duty but it's still not really legal if you make up a figure specifically to avoid tax.

well, I thought not . Just really want house so trying to think how to get round this stumbling block.

It's not legal, but its their problem not yours. You can pay extra for fixtures and fittings but they can't go mad.

NO it is not Secondhandrose - it is aiding and abettng a fraud! Not life imprisonment stuff - but definitely criminal record.

Really, sorry didn't know that.

oh God, don't see this going through now. Wonder if they cd go for a mortgage on it instead?

I would be very suspicious and would steer clear of this frankly. I find it very hard to believe that someone who had had this place all along as an investment has only just discovered their liability for CGT.

I own a flat that I used to live in and now rent out, and both the solicitor and the mortgage company made clear to me when I switched to a buy-to-let mortgage that I would have to plan for tax.

It strikes me that your vendor may not be a particularly honest or trustworthy person, and I wouldn't want to be involved in such a major transaction with her. Sorry...

Yes, like Z says they should be well aware of their tax liabilities. They can take off the estage agents fees, the cost of the stamp duty when they bought the home and all their solicitors fees and all associated costs with selling the house before they have to pay stamp duty and if they've owned it more than 3 years the cost of stamp duty drops and drops a little bit each year after that.

What does your solicitor say?

It's common abroad. It's illegal and I've never known it done in the UK. You and your lawyers and anyone who knows about it risks committing offences. Could they sell you part of the house now - e.g. a 50% interest for the lower sum and then the other half in another tax year so they can use more CGT allowances or something liike that.

that's a thought.
will check with solicitor too.