Gifts of land and buildings to charities

Posted on 25th November 2024 by Streets HMRC notices


Image to represent Gifts of land and buildings to charities

There are special rules in place for taxpayers who make gifts of land and buildings to charity. This can include Income Tax and Capital Gains Tax (CGT) relief provided all the necessary conditions are met. There are also reliefs available where taxpayers sell a property to a charity for less than its market value. Tax relief may also be available if a lease is granted to a charity that is rent-free or below a market rent.

When qualifying assets are donated, the market value of the asset is deducted from the taxpayer’s total taxable income for the tax year (6 April to 5 April) in which the gift or sale to charity occurs.

Taxpayers are exempt from paying Capital Gains Tax (CGT) on land, property, or shares given to charity. However, if the taxpayer sells the asset for more than its original cost but less than its market value, they may owe tax. In such cases, the gain should be calculated based on the actual amount the charity pays, rather than the market value of the asset.

If a taxpayer donates land or buildings, the charity may ask them to sell the asset on its behalf. Taxpayers can still claim tax relief for the donation, but they must keep detailed records of both the gift and the charity’s request. Without these records, they may be liable for CGT.


No Advice

The content produced and presented by Streets is for general guidance and informational purposes only. It should not be construed as legal, tax, investment, financial or other advice. Furthermore, it should not be considered a recommendation or an offer to sell, or a solicitation of any offer to buy any securities or other form of financial asset. The information provided by Streets is of a general nature and is not specific for any individual or entity. Appropriate and tailored advice or independent research should be obtained before making any such decisions. Streets does not accept any liability for any loss or damage which is incurred from you acting or not acting as a result of obtaining Streets' visual or audible content.

Information

The content used by Streets has been obtained from or is based on sources that we believe to be accurate and reliable. Although reasonable care has been taken in gathering the necessary information, we cannot guarantee the accuracy or completeness of any information we publish and we accept no liability for any errors or omissions in material. You should always seek specific advice prior to making any investment, legal or tax decisions.


Expert insight and news straight
to your inbox

Related Articles


LLP salaried members

Not all LLP members are taxed as partners. HMRC may treat them as employees if they meet certain conditions. Here's how the salaried member rules work, what the three-part test involves, and who’s excluded from the legislation. The salaried member


Records you must keep if self-employed

If you are self-employed as a sole trader or a partner in a business partnership, you are required to maintain suitable business records as well as separate personal income records for tax purposes. For tax compliance, these business records must be


Treatment of post-cessation receipts and payments

When a trade ends, income doesn’t always stop. Post-cessation receipts can still arise, and knowing how they are taxed is crucial. Whether it’s Income Tax or Corporation Tax, the recipient—not necessarily the original trader—bears the

You might also be interested in...