CGT - main residence

voip03

I have never previously owned a property; this is the first time that I’ve inherited a property. My share is only 35%.

We have to sell the property to receive my share.

My question is: for capital gain tax, is it possible for HMRC to consider my share of the property as main residence, to avoid paying capital gain tax on my share.

p00hsticks

Are you living in it, or have you ever lived in it since you inherited it ? If not, it can't be considered your main residence fot CTG/tax purposes.

But if you've only recently inherited it, then if the probate value was accurate there really shouldn't be any CGT to pay unless the property is somewhere where prices are rising rapidly, as CGT is only potentially payable on the difference between the value used for probate and the price it actually sells for (less any costs).

And given that you are only entitled to 35% of the value, and have an annual CGT allowance of £12,000 (unless you've used it elsewhere), I suspect it's unlikely you'll actually be liable for any CGT.

voip03

I will be living in that property from the 1st of April until it is sold. How long must I live in the property for me to be eligible for 'main residency’? 

The probate was done in September 2018, but until November 2019 (the death of my uncle), it was occupied by him. Since then, the value of the property has risen. 

p00hsticks

There's no set time limit for it to become you main residence, it;s a question of fact. For example, are you staying overnight there the majority of the time, is your post being sent there, do HMRC have it as your main address, are you on the electoral roll there etc ?

But even if it does become your main residence at some point, the time you owned it but weren't living in it means you are still potentially liable for CGT. 

Without knowing the precise figures and value of the property it's impossible to say but I'd be impressed/surprised if the increase in value in 18 months (less selling costs etc) is enough to mean you'll actually end up having to pay anything. Have you tried putting the figures into a CGT calculator ? https://www.gov.uk/tax-sell-property/work-out-your-gain