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Calculating capital gains tax
Comments
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Individual circumstances don't really matter as far as I can see for what i am asking. For example sale price of my house. Yes we don't know what that will be in the future. However if there was a formula for doing the calculation as the tax laws currently stand then I could get a good idea by entering the relevant values into this formula for my particular circumstances. The tax has to be calculated somehow. I am just after the formula for making that calculation, not for someone to necessarily tell me what my liability may or may not be.
Cheers0 -
piece of mind
peace of mind ...Not an IFA just someone imminently pensionable0 -
Did you read the link I provided earlier? There isn't a specific formula for calculating CGT. It depends on what allowances will be available to you either at the time of sale or when you dispose of the property. You can use the information given in the link to work out what your CGT liability would be for your current situation.
If that's too onerous you could try searching online for one of the many CGT calculators.0 -
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In a similar situation, what if the property was inherited by my spouse, not lived in and is about to be sold, giving a potential capital gain of current valuation vs probate valuation.
The 2015/6 annual CGT allowance is £11,100 and not transferable (as far as I can see between spouses.
If the house is transferred to common ownership with equal shares to myself and my spouse prior to sale would that result in both CGT allowances being used ie £20,200?Not an IFA just someone imminently pensionable0 -
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chaps
stiff upper lip. We're British ...Not an IFA just someone imminently pensionable0 -
DCF_Evaluator wrote: »In a similar situation, what if the property was inherited by my spouse, not lived in and is about to be sold, giving a potential capital gain of current valuation vs probate valuation.
The 2015/6 annual CGT allowance is £11,100 and not transferable (as far as I can see between spouses.
If the house is transferred to common ownership with equal shares to myself and my spouse prior to sale would that result in both CGT allowances being used ie £20,200?
yes, you would each have an allowance
you inherit under the terms of the will
you gift to your wife, she acquires it at the inheritance value for CGT purposes
BUT - technically you run the risk of HMRC "setting aside" the transfer if they decide that the only reason you did so was to reduce the tax liability. General advice in those circs is to do the transfer a "reasonable" time before you even place the property on the market. In your case therefore do the tfr asap after the inheritance and sell it no earlier than say 6 - 12 months later.0 -
Individual circumstances don't really matter as far as I can see for what i am asking. For example sale price of my house. Yes we don't know what that will be in the future. However if there was a formula for doing the calculation as the tax laws currently stand then I could get a good idea by entering the relevant values into this formula for my particular circumstances. The tax has to be calculated somehow. I am just after the formula for making that calculation, not for someone to necessarily tell me what my liability may or may not be.
Cheers
So pay a visit to your local tax office or as i suggested employ an accountant.
Don't expect someone on here to provide you a bloody Excel spreadsheet for gods sake...0 -
booksurr
That is good advice, thanks. The timings suggested are not our situation at all and any transfer could well be set aside ... will give it some thought.
Simultaneously am considering requesting an HMRC CG34 probate valuation; the probate valuation of 18m ago was a 'guestimate' without professional input and likely too low. Was wondering if anyone has experience of the CG34 route? ... ie is it hazardous, lengthy, worth pursuing etc ..? And what if CG34 comes up with a LOWER valuation than probate ..? Is the taxpayer then bound by it regardless?Not an IFA just someone imminently pensionable0
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