Giving a rental property to your children

Giving a rental property to your children

1. 1

   It counts as a sale for capital gains tax

   A gift to a child is treated as a sale at market value. You pay CGT on the gain even though no money changes hands; hold-over relief usually isn't available for a let residential property.

2. 2

   Inheritance tax: the 7-year rule

   The gift is a potentially exempt transfer — it falls out of your estate if you survive 7 years (taper reduces tax on gifts 3–7 years before death).

3. 3

   Will you keep the rent or use the property?

   YesA gift with reservation — it can stay in your estate for inheritance tax.

   NoThe child receives the rent and pays tax on it.
4. 4

   Is there a mortgage on it?

   YesThe lender must agree, and if the child takes on the debt that can count as payment for stamp duty.

   NoUsually no stamp duty on a true gift.
5. 5

   Change the title

   Transfer at HM Land Registry (or a share), update the deposit scheme, insurance and tenant notices.

6. ✓

   Get advice first

   Compare with a trust or a family investment company — the right route depends on the figures and your children's ages.

Checked against official sources on 10 November 2026 · General information, not legal advice · landlordwala.com/diagrams/gift-property-children