CGT on sale of deceased's house.

g6jns_2

getmore4less wrote: »

Untill it is assertained value is up for negotiation with HMRC on the CGT front.

Only by changing the probTe amount. The OP needs proper paid for advice.

wwl

izaac wrote: »

Oh, and there was no IHT payable as we could combine 2 people's allowances.

Pity you didn't use the highest of the EA's valuations for probate then.

If prices locally haven't gone up much since Feb you could probably make a good argument argue that the probate value was too low.
No idea how feasible it is to adjust this though - I know you can get a refund if a house sells for less than probate value, no idea if there is anything that works the other way.

getmore4less

g6jns wrote: »

Only by changing the probTe amount. The OP needs proper paid for advice.

It is not done that way if the value is not asertained

HRMC manual cover this for CGT.
http://www.hmrc.gov.uk/manuals/cgmanual/cg32263.htm

The OP would need to justify why they got the value wrong on the IHT forms if they now want to use a different base value for CGT.

Plenty of commentory out there with examples the OP can use in trying to understand their options. eg.
http://www.taxation.co.uk/taxation/Articles/2013/10/30/315851/acquisition-value.

Assenting and getting more CGT allowances is another option.

it may be, as said before, once the net proceds are worked out the tax estimate is quite low, just letting HMRC decide based on the IHT submittied value and hope they don't decide it was too high.

g6jns_2

getmore4less wrote: »

It is not done that way if the value is not asertained

HRMC manual cover this for CGT.
http://www.hmrc.gov.uk/manuals/cgmanual/cg32263.htm

The OP would need to justify why they got the value wrong on the IHT forms if they now want to use a different base value for CGT.

Plenty of commentory out there with examples the OP can use in trying to understand their options. eg.
http://www.taxation.co.uk/taxation/Articles/2013/10/30/315851/acquisition-value.

Assenting and getting more CGT allowances is another option.

it may be, as said before, once the net proceds are worked out the tax estimate is quite low, just letting HMRC decide based on the IHT submittied value and hope they don't decide it was too high.

Neither of the links you quote are definitive statements of the law. Just relying on advice from here is unwise since we don't know sufficient detail of the case nor are we legally qualified. Hence I repeat the advice that, just like any executor, the OP needs to get appropriate paid for professional advice if they are unsure what the correct course of action is.

wwl

getmore4less wrote: »

The OP would need to justify why they got the value wrong on the IHT forms if they now want to use a different base value for CGT.

"At the time it was well under IHT threshold so used an approximate figure based on varying estate agent estimates (from x to y).
Revised figure based on actual selling price, adjusted for avarage property price change for similar properties in the area between time of death and time of sale "

nom_de_plume

Is it worth submitting a C4 Corrective Account?

getmore4less

nom_de_plume wrote: »

Is it worth submitting a C4 Corrective Account?

Don't think they can do that as no IHT to pay before or after the change.
The stoner case seems to back that up.
http://www.hmrc.gov.uk/manuals/ihtmanual/ihtm33026.htm

they have to get a base value for CGT purposes if the property was not assertained as TCGA 1992, s 274 does not apply(use of probate value)

I think that is a CG34 there may be other options.

izaac

TBH I don't think the amount of CGT is going to be punative, if we end up paying it. I am going to trawl all the sites people have suggested, however!

Regarding our valuation, as mentioned, the 3 x EA valuations were all over the shop, over £50k difference between lowest and highest, and, also, I was warned here on MSE that ^over^ estimating a house value to dodge CGT is viewed very poorly by HMRC! I have been advised that I needed evidence, and that evidence takes the form of the average of 3 EA estimations.

It is a difficult property to value, actually, as the value is largely 'potential'. We are selling thin air! It's a small 3 bedder on 1/3 of a rural acre, highly developable, but the road on which it's situated barely has a single house or bungalow not raised up or extended to double its size over the past 20 years!

getmore4less

£50k is not that wide a variation on a £435k+ house only +- <6%

I reviewed you query on the tax board and aim high was the advice on that thread.

izaac

I accept that 'aim high' would, in retropect, have been our best course of action; but being only a civilian, liable to fright when warned of the potential outcome of deliberate over-valuation of the property (fines, etc); and being mindful that I had to have proof to back up our valuation- we got an average of the EA valuations. I looked at the cost of getting an official surveyor's, legally binding valuation and found that, interestingly, one of the agents who came out to look at the property was the same person as the surveyor I emailed for a quote! His was the middle EA valuation, too.

As mentioned, I am thinking the sums of money involved, after the EA fee and legals won't be enough to worry about being taxed on; and I am wondering if I can get the EA we're using to be able to demonstrate that house prices have risen quite a lot in the area in 6 months, too.