Donate to Remove ads

Got a credit card? use our Credit Card & Finance Calculators

Thanks to johnstevens77,Bhoddhisatva,scotia,Anonymous,Cornytiv34, for Donating to support the site

moving on??

Practical Issues
mutantpoodle
Lemon Quarter
Posts: 1007
Joined: November 7th, 2016, 4:21 pm
Has thanked: 509 times
Been thanked: 122 times

moving on??

#117317

Postby mutantpoodle » February 11th, 2018, 12:43 pm

my son owns a house joint (inherited) with a cousin
they do not get along
they have lived 'together' for a year or so
now they want to 'separate'
and he will come home...return to 'our house'
nominal rent as he is son...

what is tax position on his house as/when he sells?
it was inherited over a year ago if that makes any differenece

PinkDalek
Lemon Half
Posts: 6139
Joined: November 4th, 2016, 1:12 pm
Has thanked: 1589 times
Been thanked: 1801 times

Re: moving on??

#117332

Postby PinkDalek » February 11th, 2018, 2:00 pm

mutantpoodle wrote:my son owns a house joint (inherited) with a cousin
they do not get along
they have lived 'together' for a year or so
now they want to 'separate'
and he will come home...return to 'our house'
nominal rent as he is son...

what is tax position on his house as/when he sells?
it was inherited over a year ago if that makes any differenece


His CGT base cost should be the market value at the date of decease. Assuming that is how the inheritance arose.

Any chargeable gain would be taxable, subject to the normal reliefs, incidental costs of disposal etc, at the CGT rates explained here:

https://www.gov.uk/capital-gains-tax/rates

However, you or he should study this, assuming it is his Only or Main Residence

https://www.gov.uk/tax-sell-home
https://www.gov.uk/government/publicati ... ef-2017--2

It would appear highly likely that any gain would be covered by Private Residence Relief, especially bearing in mind from the second link, assuming he is selling in the near future:

The final 18 months of your period of ownership always qualify for relief, regardless of how you use the property in that time, as long as the dwelling house has been your only or main residence at some point.

swill453
Lemon Half
Posts: 7962
Joined: November 4th, 2016, 6:11 pm
Has thanked: 984 times
Been thanked: 3643 times

Re: moving on??

#117336

Postby swill453 » February 11th, 2018, 2:11 pm

PinkDalek wrote:It would appear highly likely that any gain would be covered by Private Residence Relief

Well yes. Surely it's very simple, he's selling his home so CGT doesn't come into it (from the information we've been given).

Scott.

PinkDalek
Lemon Half
Posts: 6139
Joined: November 4th, 2016, 1:12 pm
Has thanked: 1589 times
Been thanked: 1801 times

Re: moving on??

#117338

Postby PinkDalek » February 11th, 2018, 2:15 pm

swill453 wrote:
PinkDalek wrote:It would appear highly likely that any gain would be covered by Private Residence Relief

Well yes. Surely it's very simple, he's selling his home so CGT doesn't come into it (from the information we've been given).

Scott.


Yes, but we don't know when nor whether there is even a gain at the moment. The OP said as/when he sells?, which might mean he retains his share of the property for a period of time. Perhaps the cousin will buy him out after raising finance.

As you say, more information needed.

mutantpoodle
Lemon Quarter
Posts: 1007
Joined: November 7th, 2016, 4:21 pm
Has thanked: 509 times
Been thanked: 122 times

Re: moving on??

#117508

Postby mutantpoodle » February 12th, 2018, 8:13 am

the house is his residence here in UK...he owns a holiday flat abroad if thats relevant( subject to PET)
the market value at date of death...10 months before probate value agreed is lower than now...he hopes
the house is on market at higher than probate value, and he/they expect to get more.
as I understood it CGT wouldnt apply as house was his(theirs) but I wanted to ask in case some action was required to mitigate taxes

his cousin will not buy him out..both are totally independent....they both want to return home where the heating is on, and cooking is done!!


Return to “Taxes (Practical)”

Who is online

Users browsing this forum: No registered users and 6 guests