Girlfriend is selling house but .....

silvercar

Well you could move in. Properly ie address for your work, for credit cards, bank and driving licence etc. General advice is that it needs to be for at least 6 months before exchange for the revenue to be convinced, ideally a year to be above suspicion.

This would only reduce the CGT on the sale not get rid of it. If you do live in a property you don't pay CGT on the time it was your home and the last 6 months of ownership. So in this case, if you sold in 2010 after owning for 9 years, one third would be exempt. The figure then improves to about £15,000.

I don't suppose you lived in it previously?

wytco0

silvercar wrote: »

I don't suppose you lived in it previously?

No but it was subject to legal action (sued surveyory) and large scale repairs as there were some structural problems. This meant that she was has only been able to actually live in it full time for about the last 2-3 years. For the rest of the time it was uninhabitable although she had to pay mortgage/ council tax/ bills etc.

What we tend to do is spend 2-3 days each week at each others house and she stayed with me most of the time that the repairs were being done.

I think I am going to have to ask her to take it off the market and to get this sorted out as I certainly cannot afford that amount of tax and she need the full sale price for her planned next move.

noh

silvercar wrote: »

You called

................
On the face of it, if the property is owned 50:50, you have half the gain (355-210)=145, less half the buying and selling costs so say 142k, then take off your CGT allowance £10,200, leaves you with a liability on 131.8k all to be taxed at 18% so a bill of £23,724 :eek:

You forgot to divide the gain by 2
so 355k-210k=145k less 3k for expenses say 142k
the tax liability as 50% owner would be 142/2= 71
minus 10.2 allowance = 60.8
tax liability £60.8k x18% = £10944

hundredk

silvercar wrote: »

On the face of it, if the property is owned 50:50, you have half the gain (355-210)=145, less half the buying and selling costs so say 142k, then take off your CGT allowance £10,200, leaves you with a liability on 131.8k all to be taxed at 18% so a bill of £23,724 :eek:

Isn't that the bill for all of the gain?

hundredk

Should have read down - noh beat me to it!

silvercar

Sorry, too much rose wine here.

You forgot to divide the gain by 2
so 355k-210k=145k less 3k for expenses say 142k
the tax liability as 50% owner would be 142/2= 71
minus 10.2 allowance = 60.8
tax liability £60.8k x18% = £10944

Reduces to £6,684 if you move in for 6-12 months.

1984ReturnsForReal_2

Flip your house 2 days before you complete.

Avoiding tax this way is perfectly legal & above board.

Ask any MP & they will tell you the same...

david29dpo

Did you buy joint tenants or tenants in common?

Pumpkinface_2

1984ReturnsForReal wrote: »

Flip your house 2 days before you complete.

Avoiding tax this way is perfectly legal & above board.

Ask any MP & they will tell you the same...

The MPs were generallly flipping so that they could claim lots of expenses for the designated second home under MP expense rules, nothing to do with tax legislation! They were not generally flipping so they can sell the property and avoid CGT (I think one did, but she got into trouble).

dzug1

Doozergirl wrote: »

. Whether you can argue that it is your main residence due to the fact that it's your only mortgage I dont know

I doubt it - it's ownership that counts, not the existence or otherwise of a mortgage.