Guidance for selling inherited house.

iambruce

Would welcome some advice please regarding a property left to myself and my sister. I've completed IHT400 and recieved confirmation I can now apply for probate (the estate is below the threshold) As the property is left to sister and I, do we have to change the ownership with land registery prior to selling? 

Is there any capital gains or stamp duty to pay if we sell the property as soon as we are granted probate and after change of ownership with LR if required?

If either one of us decides to buy the others share of the property, as we both own another property would we need to pay stamp duty and if so is it the full value of the property?  

finally, next job probate application, is preferable to complete on line or by post? I sent the IHT by post and included the required documents.

BooJewels

I can answer some of your questions, but not all.

You don't need to change ownership with the Land Registry if you're selling it - you'll be selling it as the personal representatives of the original owner/their estate and the buyer will then register their ownership with the Land Registry as part of their purchase process.  I'm assuming there that you're actually the executors too, which your posts suggest that you are.

You only pay CGT if you sell it for more than the Probate valuation - i.e. you gain on it.  If your valuation was accurate, you're likely to sell it around the same price.  A modest variation won't result in payment due, as you have an allowance of £6,000 - until the end of this tax year - £3,000 after April 24.

Certainly do the Probate application on-line if you can - paper applications are reputed to take a lot longer.  You do it on-line, then send the paper documents they require - like the original will - to an address with a cover note they give you to print out at the end of the process.

RAS

Hi, stamp duty is paid by the buyer of the property.

It is generally better to sell the house from probate, not least as it's currently taking a long time to register new ownership.

There may be a CGT liability. Basically, the executors priced the house for probate. The executors sell the house. If the price has increased, then the estate will have to pay CGT on the difference, less any allowance. Which is why if the estate is below the IHT threshold, we suggest you choose the higher of the estimate you receive rather than the lowest.

It the house already registered?

If one of you buys the other out, the SDLT (assuming England) is paid on the consideration not on the total value.

iambruce

Many thanks for the replies,

Yes we both are executors and we believe the house is registered.

When you say the 'consideration not the total' could you explain this please?  

BooJewels

I think @RAS means that you only would pay stamp duty on the value of the half you're buying, not the whole - as you already own half.

You can check the land registration status on their web site for £1.50.

p00hsticks

BooJewels said:

You can check the land registration status on their web site for £1.50.

Although if you only want to confirm if the property is registered or not, you can presumably save your money as if it's not then there won't be anything there for you to buy, whereas just the presence of something there to buy would indicate that it is. 

RAS

Basically, although there may be estates where A let's B have all the cash, and only A  gets a mortgage for 30% of the value to cover the transfer of the house title.

It costs nothing to find out if the property is registered. If it is on the index, it costs £3 to download the registration. Worth it, in case there's a very old restriction or mention of covenants, both of which regularly wreck havoc on purchases based on cases on the selling and renting forum.

BooJewels

p00hsticks said:

BooJewels said:

You can check the land registration status on their web site for £1.50.

Although if you only want to confirm if the property is registered or not, you can presumably save your money as if it's not then there won't be anything there for you to buy, whereas just the presence of something there to buy would indicate that it is. 

Yes, it looks like you can get a summary for free and the bits to download are now £3 each - apologiesfor the slight misinformation - I confused it with the 'find a will' fee, which I did recently. 

It would be worth getting the documents though, just to ensure there aren't any charges against the property etc., such as a peppercorn mortgage etc. (Where a mortgage isn't fully paid off, so that the lenders house the deeds - pretty much outdated now, but I had to pay one off to sell an estate property).