Capital Gains Tax

[bathspray]

Hi not sure if im even allowed to post this or if im in wrong forum???

 

My father passed away last year and i was left his house. The probate has just gone through and im ready to sell. I have had letters etc sent to the house in my name for the last 6months plus. How do i go on with the CGT can i say it was my main residence or am i just better off putting the house in my partners name(deeds) and when it sells she just signs everything as if she was selling it. (Ps she is housewife so no current earnings)

 

Many thanks in anticipation

[MrShed]

Capital gains is REALLY complex. You are not exempt from CGT by "living there" for the last 6 months, it merely makes you eligible for an element of PPR relief.

 

Is your partner your wife? I assume not. If not, then dont do that - CGT is payable on transfers as well as sales, unless the transfer is between husband and wife.

[MrShed]

As a side note, be aware that taper relief is being abolished in April....

[Goldlady]

Well I don't know enough about it but I do know that you can claim CG relief on an annual basis. I would have thought if it was in probate that it wasn't actually your house anyway. However the 2007 tax returns are due on 31 Jan this year and if you and your (I presume) wife were to put the house in joint names you could claim back I think it is 8k each approx CGT without incurring any tax on it - you can do this each tax year. You need to get proper advice I think but hope this little bit helps.

[Goldlady]

As a side note, be aware that taper relief is being abolished in April....

 

Yet another stealth tax:mad:

[MrShed]

Weeeelllll....it really depends. The new system will actually be massively beneficial for short term holders of property, especially if they are in the top income tax bracket. But yes for longer holders of property there will be certain issues, although again you may still benefit.

 

I personally wouldnt class it as a stealth tax, as I would be very surprised whether CGT revenue for the IR will actually increase with this change - it is more a rebalance of the system.

 

I should point out that this position, AFAIK, is still being reviewed by Alistair Darling....

[bathspray]

Thanks for such quick replies all!!! Ive been stung for Inheritance Tax @ approx £115k already so want to have to pay as little as I possibly can if any to that fat muncher who lives at good old No. 10 D Street.

 

Thanks v much again

[MrShed]

No problem.

 

If you want, you can let us know the current value of the house, when you acquired it, and the value at this time, and I can see if I can think of how to limit the tax burden.