looking for help to bring 2007 CGT advice up to date

intheminority

hi

i've been reading martin's money tips email for years and often looked through the forum for advice but never actually posted. i've had trouble finding information myself on my current situation re: CGT.

here is a link to an article circa 2007:

timesonline.co.uk/tol/money/property_and_mortgages/article2652296.ece

in the cases discussed at the end in particular "THE STUDENT LANDLORD" (a situation identical to my own) could anyone please advise what the current numbers would look like in terms of ppr, lettings relief and cgt liability today?

in case the link doesn't work here is the excerpt:

THE STUDENT LANDLORD

John and Jane Smith bought a property for their daughter Louise to live in while at university. She lived there for three years with three other students who paid rent. Louise lived in the house on her own for a year after she graduated, but for the last six years it has been rented out. It’s now being sold and has risen in value by £100,000.

Original gain: £100,000
PPR relief (75% for the three years it was a student house and 100% for four years): £62,500
Letting relief: £40,000
CGT liability*: Nil
CGT bill: Nil *Based on rules that take effect on April 6, 2008, when a flat rate of 18% will be charged.

i apologise if this has been posted already and would be grateful for pointers in the right direction if this is the case.

many thanks

Gertie_Walker

I dont understand this. As John and Jane have never lived in the property, there is no PPR relief, nor letting relief, therefore CGT is payable on the full £100k loan.
Your scenario would be correct if Louise owned the property.

Mahmood_Reza

When the house was bought by Louises parents, was the (legal) title ever transferred to Louise, if not the gain is assessable on the parents with no relief from CGT (apart from the annual exemption). How was the income declared on previous tax returns, i.e. on parents or daughtrers tax return.