Capital gains tax after selling inherited property with two beneficiaries

Mike_59_England

Hello there

I find myself carrying out the very sad duty of executor for my father’s estate.

As my mother passed away some years ago and my sister and I (the beneficiaries) are settled in our own homes, so my dad’s house is to be sold.

It was valued for probate as £308,000, probate was granted and no inheritance tax is due, which remains the case.

However due to delays caused mostly by covid the house has only just sold (STC) and the markets have moved on such that the sale price is £360,000

Probate was carried out online due to Covid and so I only have penciled in forms that I used to gather the information for the online versions, therefore how do I prove the 308k value? and do I need to?

I understand that for the purposes of capital gains tax I can subtract the selling costs (currently unknown to me)

That there is a personal allowance of 12.5K, but is this each or just one?  and the resulting figure would be liable for capital gains tax.

The estate is to be split equally between my sister and myself.

I therefore understand that we each are responsible for settling our share of the capital gains tax?

I am a 40% tax payer while my sister is very low wage.

My brother in law (sisters husband) and I are executors does this complicate matters?

I am highly confused and rather upset and worried about getting all this right and am seeking your guidance on my statements above, how to pay the tax and how much tax each of us need to pay.

As well I need to understand what documents and information would be required

Please can you help me?

Completion date is likely 6th August, I did write to HMRC but they have failed to reply in over a month,

JGB1955

AIUI, if the house is being sold by the executors, the estate will be liable for CGT at 28%, offset by just one allowance of £12,300.  If the house has already been transferred to the beneficiaries, each will have their own £12.300 personal allowance and pay their share of CGT at the rate applicable to their circumstances (28% higher rate, 18% lower rate).

Mike_59_England

Thanks, so currently its due to be sold on the 6th.
So are you saying at that point I should divide in half and keep one for myself and transfer the other to my sister?
That was we each get an allowance and she only pays the lower rate?

Slithery

No, you would have already needed to transfer the property into your joint names before starting the selling process. It's far to late now if you are due to complete on the 6th.

The estate will be liable for the capital gain and will only have one allowance.

Mike_59_England

  OH great But thanks for the info