Capital Gains Tax - Help Required

silly-sambo

Hi,

I'm just needing a little help with Capital Gains info.

I recently moved house, selling my old flat for 106k. In order to secure a mortgage on my new flat I needed to take out a joint mortgage in partnership with my father. I bought my new flat for 182k and would assume its value now to be at around 200k, with approx spending of 12k.

I put all of the deposit on to my new flat which was 67k and I am the one who makes all mortgage payments. My father is only on the paperwork so that I could secure a higher mortgage.

My father also owns his own home, so technically my flat is a second home for him. My flat is my primary residence while his home is his primary residence.

When I go to sell my flat, probably in 3-4 years time, will I have a large capital gains bill to pay? I would imagine that, for example, if I sold the flat for 210k in 2014 that the gain would be 28k, split two ways would be 14k each. I would imagine that I would not have to pay anything personally as it is my only property, but that he would have to pay 18% of the balance after deduction of his allowance of £10,100, which, roughly would be £800. If I were to factor in spending of 12k, then I can deduct that from the original gain of 28k to leave me with a balance of 16k so half of that would be 8k, which is less than the allowance meaning no capital gains.

Is this correct?

Thanks,

Sam

CLAPTON

the gain is the difference between the selling and buying price less allowable expenses
these include costs of buying and selling and also 'improvements' but not maintenance
so it rather depends upon what the 12k was spent on