How to Gift Property to a Child in the UK Without Paying Tax

For many families in the UK, gifting property to children is a practical way to provide financial support, plan for the future, or reduce the impact of inheritance tax. But one important question always arises: “Can I gift property to my child without paying tax?”

The answer is yes — in some cases. While tax rules apply, with the right planning, you may be able to gift property without triggering tax liabilities.

In this guide, we’ll explain the tax rules, HM Land Registry requirements, and how Property Swift, your digital-first property transfer specialists, make the process fast, paperless, and stress-free.

Is It Legal to Gift Property to a Child in the UK?

Yes, gifting property is completely legal in the UK. Whether you’re transferring ownership of your home, a second property, or part of your estate, HM Land Registry will recognise the transfer as long as it is properly documented and signed.

At Property Swift, we manage the process digitally — helping you prepare the documents, complete required ID verification calls, and ensure HM Land Registry requirements are fully met.

What Taxes Apply When Gifting Property?

When gifting property, three main taxes may apply:

1. Inheritance Tax (IHT)

• Property gifts are considered Potentially Exempt Transfers (PETs).
• If you survive 7 years after making the gift, no IHT is due.
• If you pass away within 7 years, the gift may be taxed depending on its value.

2. Capital Gains Tax (CGT)

• If the property is not your main home (e.g., a rental or second property), you may need to pay CGT on the increase in value since you purchased it.

3. Stamp Duty Land Tax (SDLT)

• Your child does not pay SDLT if the property is gifted without a mortgage.
• If a mortgage is transferred, SDLT may apply.

How to Gift Property Without Paying Tax

To avoid unnecessary tax charges, consider these strategies:

• Use the 7-Year Rule: Gifts made more than 7 years before death are exempt from inheritance tax.

• Gift a Mortgage-Free Property: If your child takes on a mortgage, SDLT may be triggered. A gift of an unencumbered property avoids this.

• Plan Early: Lifetime planning reduces the risks of inheritance tax and allows time for the 7-year rule to take effect.

• Get Specialist Support: Property Swift ensures your transfer is prepared correctly, ID verification calls are completed, and documents are submitted without delays.

Process of Gifting Property to a Child (Step by Step)

1. Check tax implications - review IHT, CGT, and SDLT rules.
2. Prepare the transfer deed - requires a wet (physical) signature.
3. Complete ID verification call - a compliance step required by HM Land Registry.
4. Submit to HM Land Registry - managed digitally through our platform.
5. Confirm transfer - ownership updated in the Registry.

Common Mistakes to Avoid

• Forgetting the 7-Year Rule: Gifts made shortly before death may still be taxed.
• Ignoring CGT: Second homes and investment properties often trigger capital gains.
• Overlooking mortgages: If a mortgage is transferred, SDLT may apply unexpectedly.
• Incorrect paperwork: Mistakes or missing details cause HM Land Registry delays.

FAQ Section

Q: Can I gift my property to my child tax-free?

Yes, if you survive 7 years after gifting, the inheritance tax is avoided. If the property is your main home, CGT may also not apply.

Q: Does my child pay Stamp Duty on gifted property?

No, unless the property has an outstanding mortgage, in which case SDLT may apply.

Q: What happens if I pass away within 7 years of gifting property?

The property may be taxed as part of your estate, depending on its value and the time that has passed.

Q: Do I need a solicitor to gift property to a child?

No, Property Swift is a property transfer specialists who guide you through the process, including ID verification calls, and ensures compliance with HM Land Registry.

Conclusion

Gifting property to a child in the UK is not only legal but also a smart estate planning tool. By understanding the tax rules — especially the 7-year rule — and ensuring the transfer is handled correctly, you can often gift property without paying tax.

At Property Swift, we make the process simple, paperless, and fully compliant with HM Land Registry.

💻 Ready to gift your property with confidence?

👉 Start your property transfer today with Property Swift.