Part-Ownership Of A Second Property

[Robert G]

I already jointly own (with my wife) the house we live in. I own no other property. I'm thinking of part-owning a property (about one third value) jointly with my daughter, a house which she would live in as her home. What are the income tax implications for me if and when my daughter and I sell this house and I receive my share of the proceeds? Would I pay capital gains tax on ALL of my share of any gain, or would there be some tax relief/allowance which could be set against this?

[Gizmonster]

I was virtually in the same position as you quite recently.
I part own my own house with my missus and I bought another house with a friend (50% share each).
Any repairs and maintenance to the house will count towards tax deductables when you sell the house so keep all your receipts etc. I'm not 100% sure if absolutely everything counts, for example, regular gardening work, or maybe even decorating, might not count, though I may be wrong.
When you sell, you'll both have your capital gain's allowance that you can offset against the profit as well.
I'm not too sure what the current CG allowance is - it's approx £10k, so if, for example, you pay £100k for your house and you have £10k of receipts and you sell it for £160k, you'll both have made a profit of £25k ..... minus your CG allowance of approx £10k - you'll both pay CP on £15k at the appropiate rate.

[Robert G]

Many thanks, Gizmonster, that is helpful.

[Peter Pedant]

Income tax no charge unless it is rented

Capital gains as above - someexpenses mentioned are allowable against revenue sucha s repairs
Others are allowable against capital and these are improvements and renewals.

When you come to sell you should assign half the value to your lady wife and that would mean that her CGT allowance (ten big ones) is also allowable. You then pay CGT on the remainder at your marginal values.

In the year you sell you really should have an accountant
because as you can see the rules are complex but are easily used to minimise tax .

If you assign later your half to your daughter then you need to live for 7 y or else take account of it in your will. (include it in the zero band set of bequests ) or else basically she will get a tax bill for 40% of your share. If you do that you should not sleep in it ever to avoid the reservaton of benefit provisions