CGT due on spouse inheriting rental property ?

Silverbullet036

Hi everyone , my brother has died and together with his wife they owned and rented out a flat with a mortgage. He died with a will and everything passed to her and she now wishes to sell it to release some capital. My question is as the title says : Will she be liable for CGT as this is not her main residence ? Or is there some clause or even a regulation that reduces the liability if she does have to pay ? I have something in my head that says maybe half the difference between the original cost and half of the rise since may be liable for tax ?? TIA

El_Torro

I can kind of see your logic but no, there's nothing here that suggests that there should be  any reduction in Capital Gains Tax. Did your brother's estate pay Capital Gains Tax on his half of the property when he died? I guess not. 

Keep_pedalling

She will have CGT to pay on he4 original share of the property, but not on the inherited share provided it has not increased in value since her husbands death.

Death wipes out any CGT liability the deceased has built up in their assets while they were alive.

Silverbullet036

Keep_pedalling said:

She will have CGT to pay on he4 original share of the property, but not on the inherited share provided it has not increased in value since her husbands death.

Death wipes out any CGT liability the deceased has built up in their assets while they were alive.

Thank you , the property was bought for £127k and is on the market for £135k , would this increase be liable or maybe only her share of the increase ?

Keep_pedalling

Silverbullet036 said:

Keep_pedalling said:

She will have CGT to pay on he4 original share of the property, but not on the inherited share provided it has not increased in value since her husbands death.

Death wipes out any CGT liability the deceased has built up in their assets while they were alive.

Thank you , the property was bought for £127k and is on the market for £135k , would this increase be liable or maybe only her share of the increase ?

If it goes for that value there will be very little if any CGT liability once buying and selling costs have been factored in even where the annual exemption drops to £3000 in April.

Silverbullet036

El_Torro said:

I can kind of see your logic but no, there's nothing here that suggests that there should be  any reduction in Capital Gains Tax. Did your brother's estate pay Capital Gains Tax on his half of the property when he died? I guess not. 

No his estate in its entirety passed to her and no CGT was paid on anything. There wasnt a lot to pass over other than a personal pension , a rental property and few bits and bobs in some bank accounts

Silverbullet036

Keep_pedalling said:

Silverbullet036 said:

Keep_pedalling said:

She will have CGT to pay on he4 original share of the property, but not on the inherited share provided it has not increased in value since her husbands death.

Death wipes out any CGT liability the deceased has built up in their assets while they were alive.

Thank you , the property was bought for £127k and is on the market for £135k , would this increase be liable or maybe only her share of the increase ?

If it goes for that value there will be very little if any CGT liability once buying and selling costs have been factored in even where the annual exemption drops to £3000 in April.

So the half of the property that she has inherited will not be liable for CGT ? As you stated earlier his death negated any tax his half may have incurred , even though she now has ownership of the whole thing ? Summing up , the only part that may incur the tax is the actual profit between the buying price and selling price which is further reduced when all the appropriate fees are taken into account ? thank you for your help