Will we be liable for Corporate Gains Tax when we sell our family home? I'm separated from my wife

Livetoeat

My wife and I separated over 8 years ago and she has continued to live in the family home while I have had to rent a three-bedroom property for me and my two children at considerable expense. We are finally sorting our financial settlement and have a date for the Final Hearing in the family court (FDR). We own the property in our joint names and we have not transferred the property. I have paid the mortgage during the time I have been living outside of the family home and neither of us own any other property. It has now been suggested that when we sell the property in the next few months there may be a Corporate Gains Tax liability. 
I am sure countless families have been in the same situation but it seems to me there is very little clear information about this and I have had differing advice on this from accountants, solicitors and even the HMRC. It seems hugely unfair as I have incurred huge costs to enable my wife to continue to live in the property and to provide a home for my children when they are with me. I have always regarded the family home as my permanent address. 
Can anyone shine some light on this for me please?

RAS

Capital Gains Tax. Paid on houses you don't occupy.

JGB1955

RAS said:

Capital Gains Tax. Paid on houses you don't occupy.

I'm not sure if that applies if the sale is due to a court order....but could be wrong.

propertyrental

The manual is, to me, confusing, so I link it here for you to read!

https://www.gov.uk/hmrc-internal-manuals/capital-gains-manual/cg65300

The treatment of transfers between spouses or between civil partners is different when they are permanently separated. In summary the main provisions are:

• a transfer of an asset which takes place after the end of the year in which separation occurs will take place at market value, see CG22500+;

• spouses or civil partners who are separated are each entitled to relief on their own only or main residence;

• if either of them has more than one residence they are separately entitled to make nominations under s222(5) TCGA92, see CG64485+.

More here and in the following pages....

https://www.gov.uk/hmrc-internal-manuals/capital-gains-manual/cg22400

Annisele

It looks as though there may be some upcoming changes to CGT for people in your situation (see, for example, this article). Part of the reason for the proposed rule change is precisely the unfairness you mention.

In principle, if you sell a property that you didn't live in then there's a potential for a CGT bill. But whether there's actually any tax to pay depends on all sorts of things. The fact you lived in the house for a while will give you relief for the proportion of time you lived there (eg if you lived there for 8 years of a 16 year ownership, then you'll get relief for 50% of the gain straight off). Then there are usually other allowances that cover some of the time you didn't live in the property (see here). And depending on the rest of your tax position (i.e. how much you earn, and what other capital gains you have) then you might not end up having to pay any tax at all.

But, this is something that is IMO pretty easy to get wrong, and expensive if you make a mistake. I suspect you'll be better off paying somebody (a solicitor or an accountant) to advise you, and then you'll have somebody to sue if they mess up. It's too much money to be relying on random people from the internet!