Capital Gains Tax

[Deleted User]

Is there even a remote possibility that the heirs will accept a rent for the one-third share?

scallysally

We could ask for renting the third out yes. However that is not going to benefit certain people within the heirs as between around 5 of them benefiting from the property a cut of £500 a month split is very little .. also they have to account for all that within own tax, can not see many of them being happy with that. 

BoGoF

I'm assuming there must have been some logic at the time to have had this 3 way set-up?

scallysally

I have also suggested if we have to dispose of the property or legal fees are to be covered by the estate, whom have the aunts third of the house.  I feel this is a genuine request, i feel this is going to be turned down also.  

eskbanker

scallysally said:

Yes its our main home, we lived here for some years now. Adding to the value of the home at the same time, they can force a sale your right we have a child also in the property whom is 12 so assume the court take that into account. We would be without a home. I am unsure what the heirs will do with the profit assume just enjoy them at the expense of us loosing a home! 

Naturally a sale inherently involves moving from the property, but obviously you'd have a sizable chunk of equity to fund a move elsewhere, even if it's not as much as you'd have liked?

scallysally

I understand we have a chunk of equity, but really MIL is also loosing out a good amount of money on CGT for them forcing a sale? Really that can not be fit in the eyes of the HMRC?

BoGoF

scallysally said:

Really that can not be fit in the eyes of the HMRC?

Not sure what you mean by that but HMRC will not care what the reason is but the tax will be due.

eskbanker

scallysally said:

I understand we have a chunk of equity, but really MIL is also loosing out a good amount of money on CGT for them forcing a sale? Really that can not be fit in the eyes of the HMRC?

Why not?  She invested a small amount of money in a property (not her own home) and it's now worth substantially more, which is exactly what capital gains tax is designed for....

scallysally

I understand the tax is due, but the reasons why the tax is due is out of our hands. Selling our home is not what we intended to do. 

BoGoF

scallysally said:

I understand the tax is due, but the reasons why the tax is due is out of our hands. Selling our home is not what we intended to do. 

Goes back to why this arrangement was put in place to start with. Some bad advice or an attempt to DIY has came back to bite I'm sorry to say.