Capital gains tax on only home but living in another

Jessiejane17

Any help or thoughts appreciated… 
my dad owns his own house, his is the only name on the property (ex wife died) but he doesn’t live here (I do, the daughter - will be buying from him within the year). All bills except council tax are in his name still, we are wondering if capital gains tax will be imposed? I have read that it isn’t on the “main home” which technically this house he owns is still the main home - he only moved during covid as you couldn’t mix households but his partner (not married) owns her own home by herself, my dad has just been staying with her instead. How is it proved what the main home is? Any help thank you! 

user1977

If he's not living there then it simply isn't his principal residence and will be subject to CGT for the relevant period (though there is a "grace" period after he moves out). Utility bills being in his name doesn't mean much.

km1500

he can 'nominate' any house he owns as his main home for cgt purposes as long as it is not let (eg subject to an AST). He can live where he likes for 3 years.

you can live in his house as his guest, he can stay with his partner. It is still his main residence for cgt purposes.

https://www.gov.uk/tax-sell-home/absence-from-home

theartfullodger

Yes, CGT may be due: Has to be declared AND PAID within 60 days of sale.  Depends how much value has gone up between when he moved out & when sold, compared to CGT allowance. (recently values have been dropping what with the cost of leaving crisis etc etc..

Did he get several independent valuations when he moved out please??

sheramber

km1500 said:

he can 'nominate' any house he owns as his main home for cgt purposes as long as it is not let (eg subject to an AST). He can live where he likes for 3 years.

you can live in his house as his guest, he can stay with his partner. It is still his main residence for cgt purposes.

https://www.gov.uk/tax-sell-home/absence-from-home

He must live in the house at the end of the period

You must have lived in the home before and afterwards, unless your work prevented you.

MEM62

theartfullodger said:

Depends how much value has gone up between when he moved out & when sold, compared to CGT allowance. 

Not quite.  (Although I really wish you were right as it would save me a chunk of change when the sale of my property completes in the next few weeks)

CGT is paid on the difference between what he paid for the house when he originally purchased it and what he sells it for - less an allowance for the amount of time that it was his primary residence.  That said, if he only moved out during COVID, I doubt that there will be a CGT liability when his CGT allowance and primary residence allowance are taken into account.       

Jessiejane17

theartfullodger said:

Yes, CGT may be due: Has to be declared AND PAID within 60 days of sale.  Depends how much value has gone up between when he moved out & when sold, compared to CGT allowance. (recently values have been dropping what with the cost of leaving crisis etc etc..

Did he get several independent valuations when he moved out please??

He hasn’t officially moved or sold yet - I moved back home at beginning of pandemic and he moved with his partner as no households mixing he wanted to be with her etc. do he does stay there majority of time but this is the only house he owns and has owned for over 15 years… it is his main residence in our eyes because it’s where’s he’s lived the majority of 15 years it’s only been the last 2-3 he’s been at his partners because of how things have been in the U.K.. thank you for your reply 

Jessiejane17

We’re confused how it could ever be determine what main residence is? If he owns the property has all bills bar one in his name, still has stuff here then isn’t this still his main property? But I was worried because CGT would be hefty for him and it’s just another blow after a tough for years and obviously we wouldn’t want to do wrong. As we see it - this is his main property/only property - he’s just been staying with his partner for ease 

theartfullodger

Jessiejane17 said:

theartfullodger said:

Yes, CGT may be due: Has to be declared AND PAID within 60 days of sale.  Depends how much value has gone up between when he moved out & when sold, compared to CGT allowance. (recently values have been dropping what with the cost of leaving crisis etc etc..

Did he get several independent valuations when he moved out please??

He hasn’t officially moved or sold yet - I moved back home at beginning of pandemic and he moved with his partner as no households mixing he wanted to be with her etc. do he does stay there majority of time but this is the only house he owns and has owned for over 15 years… it is his main residence in our eyes because it’s where’s he’s lived the majority of 15 years it’s only been the last 2-3 he’s been at his partners because of how things have been in the U.K.. thank you for your reply 

So he moved out.  There is no "hasn't officially moved out".  You either move out or you don't: he's moved out. 

Understand about how things have been in UK what with cost of leaving etc etc..

Good luck!

propertyrental

'Only property' is not the same as 'principal residence'. 

CGT can be a complicated area as evidenced by the conflicting posts above, so read the various official links and then determine. And yes, there are allowances, exceptions, and conditions.

 how it could ever be determine what main residence is? If he owns the property has all bills bar one in his name, still has stuff here then isn’t this still his main property?

That's two separate issues:
1) it may be his main (or only) property, but that doesn't automatically make it his principal residence (ie where he actually lives).
2) as for how it can be determined - that applies to any aspect of the law, tax rules etc. It's a question of fact and proof.  I can drive at 90 mph, but in the absence of cameras or police I reckon my illegality can't be determined.

Unless or until some ***** with a dash cam reports me..........