CGT with inheritance [cgt] [captial gains]

gnekelfihg

thanks. I'll get some clarification from my solicitor because she doesn't seem on the ball on this issue. Firstly not trying to exempt half the gains because the house has been my brothers only residence for years, and secondly because there seems to have been no accounting for the £11k cgt personal allowance.

sheramber

does the fact that the brother lived in the house but was not the owner still render his share exempt from CGT.

uknick

sheramber wrote: »

does the fact that the brother lived in the house but was not the owner still render his share exempt from CGT.

I believe the gain they are calculating is from when the house passed to the children, i.e. upon the death of the mother, to the current sale. So, I'd say yes PRR is applicable as he has lived in it since he became the part owner.

antrobus

gnekelfihg wrote: »

thanks. I'll get some clarification from my solicitor because she doesn't seem on the ball on this issue. Firstly not trying to exempt half the gains because the house has been my brothers only residence for years, and secondly because there seems to have been no accounting for the £11k cgt personal allowance.

Ask an accountant.

But you get PPR where "the dwelling house has been your only or main residence throughout your period of ownership".
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/323679/hs283.pdf

So the brother's residence in the property during the period of somebody else's ownership would be irrelevant. And that would include the period during which it was owned by the estate.

But I'd ask an accountant.

uknick

gnekelfihg wrote: »

thanks. I'll get some clarification from my solicitor because she doesn't seem on the ball on this issue. Firstly not trying to exempt half the gains because the house has been my brothers only residence for years, and secondly because there seems to have been no accounting for the £11k cgt personal allowance.

Why would you expect your solicitor to know anything about tax? You wouldn't ask an accountant to convey your house sale.

When we dealt with my mother-in-law's estate we asked a solicitor to certify some documents for probate. As part of the process we had completed the various IHT forms ourselves. The solicitor was impressed by this and confessed nobody in her practice could do the IHT stuff and offered (I hope jokingly) a job doing IHT work.

CLAPTON

uknick wrote: »

Why would you expect your solicitor to know anything about tax? You wouldn't ask an accountant to convey your house sale.

When we dealt with my mother-in-law's estate we asked a solicitor to certify some documents for probate. As part of the process we had completed the various IHT forms ourselves. The solicitor was impressed by this and confessed nobody in her practice could do the IHT stuff and offered (I hope jokingly) a job doing IHT work.

some solicitors do specialise in probate so would be expected to be experts in all aspects of the job.
However if they are not, then they should make it 100% clear they know nothing about tax and that assistance needs to be sort elsewhere.

gnekelfihg

Haven't managed to get through to my solicitor but someon else came to the phone...

They said as the sale is related to the estate there is only one cgt allowance and the fact that my brother lived then doesn't affect anything.

However, the great tax authority, the guardian* , disagrees.

* can't post links... article title is: Will we have to pay capital gains tax on our father's estate?

xylophone

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/323671/hs282.pdf

Does anything in the above assist?

gnekelfihg

Thanks!

This makes it sound like the disposal of the house should be goverend by individual cgt rules, and therefore subject to 2x allowances and PRR.

All assets acquired by a legatee following a death, which were assets owned
by the deceased at the date of death, are treated as though acquired by
the legatee:
• at the date of death
• at their market value on the date of death.
Assets acquired by the personal representatives during the course of the
administration are treated as though they had been acquired by the legatee:
• at the date of acquisition by the personal representatives
• at the cost to the personal representatives or the value at which they were
acquired by the personal representatives.
If the legatee subsequently sells or otherwise disposes of those assets,
the normal rules of Capital Gains Tax (CGT) will apply.
The legatee is not entitled to claim unused losses of the deceased or
personal representatives or any of the expenses incurred by the personal
representatives in establishing title to the estate. They may claim on any
future disposal any expenditure incurred by them or by the personal
representatives relating to the actual transfer of the asset to the legatee.

zygurat789

gnekelfihg wrote: »

Haven't managed to get through to my solicitor but someon else came to the phone...

They said as the sale is related to the estate there is only one cgt allowance and the fact that my brother lived then doesn't affect anything.

However, the great tax authority, the guardian* , disagrees.

* can't post links... article title is: Will we have to pay capital gains tax on our father's estate?

http://www.theguardian.com/money/2014/jul/10/capital-gains-tax-fathers-estate