Eventual CGT on flat purchase

eddtheduck

My wife and I are thinking of helping her parents buy a flat that is better suited to their needs (they are quite elderly). We would probably own about 15% of the flat. When both her parents die, their intention is to leave the remaining 85% of the flat to my wife and her brother (so 42.5% each). As things stand, we do not intend to beome resident in the flat.

My question is: how would CGT work once the parents die and the flat is sold - would we be paying CGT on 15% of the gain, or (42.5 + 15%) of the gain?

Would we avoid paying tax on 42.5% of the gain if the executors sell the flat and pass the proceeds on to my wife and her brother?

00ec25

you would pay CGT on 15% of the gain from the date you purchased it to the date it sold. If you think you are avoiding by having an interest in possession trust you need to pay for professional advice to set that up as it is not DIY territory

you would pay CGT on 42.5% of the gain from the date of inheritance to the date of sale (if there is such a delay and that share of the gain is large enough to be quantified)