A few years ago, my husband, my daughter and I purchased a property together . My daughter was living in Property A until the pandemic began, and her company told her she had to work from home. Property A was unsuitable for working from home, so she moved back into our family home with us.My husband and I recently bought another property . We were planning on using this as an investment property.
Given that she has been part-owner of Property A for a number of years, it is highly likely that the value of that property will have risen, giving rise to a potential claim for capital gains tax. Then there is the actual transfer. There are two likely options here. Either she is selling her share of Property A to you and buying a share of Property B, or she is gifting you the share of her existing property and you are gifting her the share of the new one – or some combination of these. The important thing to be aware of is that they have different implications.
If you simply try to gift the shares in the respective properties to each other, things could get messy taxwise. She can take a gift of up to €335,000 from her parents over and above a €6,000 small gift exemption but unless she has died, you are limited to receiving a gift of €32,500 from her – on top of the €3,000 small gift exemption each of you can receive from her.
Another option is that you could always retain the current ownership structure of Property A, with her receiving her share of its rent and she could rent Property B from you and your husband, although this clearly would be an ongoing cost to her.