Over recent weeks we’ve noticed a marked increase in the number of enquiries and instructions for Capital Gains Tax (CGT) valuations across London and the surrounding areas. The surge appears to be driven largely by clients who are gifting property to children and other relatives ahead of the forthcoming November Budget. It’s a trend that reflects growing uncertainty about potential tax changes — particularly in relation to CGT rates and inheritance tax allowances.
When property is gifted, it is treated by HMRC as if it were sold at market value, even if no money actually changes hands. This means that the donor may be liable for CGT on any increase in value since they acquired the property. To establish this figure accurately, a professional market valuation as at the date of transfer is required.
The recent uptick in instructions suggests that many owners are keen to transfer assets in anticipation of unfavorable changes to the tax regime. With speculation about possible tax rises in the upcoming Budget, some families are choosing to act now rather than risk higher liabilities later. London homeowners, in particular, have often seen substantial capital appreciation over the years, meaning potential CGT exposure can be significant.
It is key is to ensure that valuations are thoroughly researched and well-documented. This typically involves inspecting the property, analysing comparable sales evidence, local market trends, and any factors that may affect the property’s marketability.
It’s also important to remember that while gifting can be a useful estate planning strategy, it is not without its pitfalls. There may be inheritance tax implications if the donor continues to benefit from the property after the transfer, and stamp duty considerations in some cases. Therefore, clients are always advised to seek coordinated advice from both a chartered surveyor and a tax adviser before proceeding.
Our surveyors regularly undertake valuations for Capital Gains Tax purposes. If you would like to arrange a valuation of your property, please call our experienced team on 020 7183 2578 or send your enquiry by email.