Capital Gains Tax

[calmck]

Two sisters bought a property in 1994. One since died in 2013 and her share passed to her husband in her will. The property is now being sold. How is CGT applied in this case

[Peter Pedant]

// A Beneficiary will not usually be liable to pay Capital Gains Tax on their inheritance. However, if an asset is transferred to them from the Estate (such as shares or a property, for example) and they then sell this at a later date for a profit, they may become liable for Capital Gains Tax at this stage.27 Feb 2019//

Sister A who died in 2013 - there has been an IHT event and so the gain for the husband is counted from 2013 ( you need a valuation at 2013 - available from any estate agent - but - - - the valuation for the IHT purposes in 2013 will do.). So he enters the date of acquisition as the date of her death and that is the date for the valuation.

Sister B - her CGT will be from date of purchase ( sister A's death does not affect her)

You (they) need to register for CGT on the internet
they really need to do this now

https://www.gov.uk/capital-gains-tax/report-and-pay-capital-gains-tax

You have to enter the details and pay the moolah within four weeks of completion.

it is not that bad - the site is easy to use. The only thing is that if the gain is £134 000 - not impossible in todays climes - some tax may be at 18% and some at 28%- the machine does it for you.

[bobbinwales]

Peter ...does it depend on weather it was there only property that they bought or was it a second home as an investment

[Peter Pedant]

yes - fist home exemption applies er if it applies

My nephew and I sold a jt property. He didnt pay CGT as first home - I did - (coz it wasnt my first home)

if the second sister is alive, and it is her only home then the first home exemption applies

alot of this is voluntary - if sis1 had left it to sis 2 then no CGT and no tax ( but hubby may feel left out)

I think this should be sorted out before death but a lot of people dont. ( alot of people 67% dont do wills. )( o god and as I get older, there is a LOT of 'I want my share now!' jesus)

[Peter Pedant]

original supp - - - ( lementary question, silly!)
does it depend on the weather.....

I thought a bit - - prophetic

[davebro]

Assuming none of them lived in the property(?) I think the surviving sister will be liable to CGT on 1/2 the gain over the original purchase price & the widower will be liable to CGT on 1/2 the gain over the value in 2013. (but check with someone who knows!)

[Peter Pedant]

I probably agree with that