Advice needed

NHT1969

I inherited an art collection from a great Aunt, who passed away almost 30 years ago. It was her life’s work. 

I’ve recently been offered £150k from a Museam who wishes to acquire the collection. 

Can anyone advise me on the following. 

A) as i inherited the items and it’s under the inheritance tax threshold. 

Is it tax exempt. 

Or 

Do I have to declare as capitol gains and pay tax on it ? 

Thanks in advance. 

george9071

Not sure on this one but you will probably have to tax on this yes.

RobM99

I'd suggest - ask a tax expert!

dont_look_now

Since you inherited the collection, you calculate the gain as the difference between what you sell it for and its market value when you inherited it. Then you have a £12,300 capital gains tax exemption (for the current tax year). Gains over that amount are taxed at 10% or 20% or a mixture of the two.

Given the figures, it's probably worth getting (i.e. paying for) an expert opinion about that market value for 30 years ago.

happy_hazelnuts

You didn't say when you inherited it but if you  inherited it recently then there is no tax to pay as the market value will not have changed much between the date of inheritance (when it became your property) and the date of sale.

If you inherited it some time ago then you might have a capital gain i.e. the difference between the valuation at inheritance and valuation today in which case capital gains tax will be payable less your annual allowance of course

kinger101

Any inheritance tax liability should have been settled shortly after your great Aunt died by the executor of the estate.  From this exercise, you should have received what is called a probate value for the paintings, which you'd treat as your acquisition cost.

What you'll have to pay now is capital gains tax.  The gain would be calculated as the difference between the sale price and probate value.  I suggest contacting a chartered accountant, or better still, chartered tax advisor.

Albermarle

as i inherited the items and it’s under the inheritance tax threshold.

As above - inheritance tax ( if due ) is always paid by the state of the deceased person. The beneficiaries are not affected by this at all .