Working out CGT Gain on Jointly Held Property

silvercar

Jeremy535897 said:

silvercar said:

Jeremy535897 said:

silvercar said:

Happy to be corrected.

You owned all the property from 2002, when it was your PPR. You then transferred half to your partner in 2008. It was then sold in 2024.

As it was your PPR, you are exempt from CGT for the time it was your home and the last 9 months of ownership. Your partner owned half of it from 2008 to 2024, without ever living in it as her PPR, she has no exemptions. (Other than CGT allowance) so her gain would be half of 200k-130k= 70k/2 =35k less CGT allowance, charged at her marginal rate.

For your Calculation it is more complex. You have all of the gain for 6 years and half of the gain for 16 years. So your gain would be 6/22 plus 16/22 /2 = 14/22 of the gain of 118= 75k Then it was your PPR for 6/ 22 + the last 9 months. So you reduce the 75k to 52k. Less CGT allowance, charged at marginal rate. I’m thinking this is the way as the 130k valuation won’t figure as you didn’t sell it at that point, but I’m happy to be corrected.

you can both deduct selling costs and you can deduct buying costs.

A couple of observations. Firstly, we are assuming both that the partner never occupied the house as a main residence (which does seem to be what OP says, but best to check) and secondly we are assuming that they are not civil partners, merely cohabitants.
More importantly, the way you work out OP's gain is £100,000 less £41,000 = £59,000 (to adjust for acquisition costs, selling costs and improvements), and then you allow roughly 7/22 as main residence relief (actual occupation plus last 9 months). This should be done to the nearest month when doing the actual calculation. On my estimate, the taxable gain for OP is £59,000 x 15/22 = £40,000. See section 222(7) TCGA 1992.

222(7) (b) seems to suggest that if they got married before sale, she would acquire all his PPR and reduce her tax bill. @Jeremy535897 is that right?

I fear not, as the disposal would not have been between husband and wife, as they were not married at the time.

Ok. I was reading ‘the disposal’ as the sale occurring now, not the gift between them in 2008.