My daughter is a single mother and as I am a widow it seems sensible to buy a property together. We propose to buy a large run down house in my name and convert it ideally into 2 flats; one for each of us. My younger daughter is proposing to lend us the money until our properties sell. Now here comes the problem: how do we stand if one property takes 12 months to sell and the new property remains in my name until after the sale of the second property? Will there be any tax liability and if so how long do we have to put the property in joint name before creating this liability? Would it be better not converting or delaying converting?

If you pay £X for the property now, and it is in your name, and then later you transfer half the property to your daughter, then there could be: a) a capital gains tax liability if the market value of the property at the date of the transfer is more than £X; and b) stamp duty land tax on the transfer if she pays you more than £125,000 for her half. Why don't you buy the property now in the names of both of you? This will take away the need to do any transfer later. If this is not possible, then you could closely monitor the market value of the property, and if you see that it is rising to the extent that half the house has increased in value by close to £10,600 (i.e. the capital gains tax annual exemption) then you can quickly do a transfer. This will help for the first obstacle, but the second is only avoidable if you agree amongst yourselves that she won't pay you more than £125,000 for her half of the house.