Capital gains

silvercar

Bookworm105 said:

silvercar said:

I’m wondering if being married saves you money. If she transferred the property to joint ownership before sale, I think that you would acquire her date of purchase and PPR. 

no,
you are correct that a married couple can transfer ownership but you incorrect that a person inherits PRR back to the original purchase date if (big if) that person never lived in the property themselves as their main home (even for 1 day) prior to the transfer.

Op has never lived there, so it is a dead duck

Are you sure? The rules changed in 2020, see example 2 on this page - https://www.cronertaxwise.com/community/14022023-ppr-transfers/

and this article - https://www.taxinsider.co.uk/ppr-change-to-interspouse-transfers-whats-new-ta

Bookworm105

mills1983 said:

Thanks again - the renovations are an extension and new windows and new front door that were put in - that's fine isn't it?

Just thinking about it, whilst she moved in with me in Feb 2020 due to COVID she was still back and forth, and didn't come on the mortgage until 01/04/2021, so that would be a more accurate start date for the other home becoming her  'second home'. 

Thanks 

extension = yes, capital, new part of the building that did not exist before 
window and door = No, revenue repair. There was a window and door before, nothing has changed and there is no way such a huge technological change has taken place in windows and doors that you could claim they were "improvements".

"coming on to the mortgage" is irrelevant
you got married in 2023 so you are right to question the period up to then in terms of where was her main home. After date of marriage there can only be one main home, which obviously in this case is "your" place.

defining "main home" is the result of a large array of subjective opinions of what would the man in the street think when looking at her occupation pattern

• was the property still available for her use? If let, then no it is no, end of assessment!
• was she commuting to work from your place? (Yes, then +1 to yours = main home)
  
• where would her friends expect her to be if they called by to go out with her? (yours +1 = MH)
  
• where does she spent more time? (although note "time spent" does NOT carry an overwhelming weight in the equation results) 
  
• where was she registered to vote?
  
• Which address was used for correspondence?
  • Banks & Building Societies
  • Credit cards
  • Utility bills
  • HMRC and other Government departments
• At which address was the individual’s car registered and insured?
• Which address was the main residence for council tax? Were there any council tax exemptions in place, such as for the dwelling-house being uninhabitable or a second residence?
• Does the utility bill usage suggest that it was occupied as the main residence of the individual and their family?

CG64545 - Private residence relief: two or more residences: no valid notice made - HMRC internal manual - GOV.UK (www.gov.uk)

On the balance of the above, would yours obviously be her main home or is it still very grey?

Bookworm105

silvercar said:

I’m wondering if being married saves you money. If she transferred the property to joint ownership before sale, I think that you would acquire her date of purchase and PPR. You would therefore also have your CGT allowance to use. But you need to check your personal tax status, as a higher earner could end up paying more than the CGT allowance would give you.

that is a potentially worthwhile tax saving measure 
the rules charged in April 2020 after which the requirement that both spouses had to have lived in the property as their main home at the point of transfer was removed.
CG64925 - Private residence relief: ownership period: spouses or civil partners and legatees - HMRC internal manual - GOV.UK (www.gov.uk)

Therefore she could now make him a co-owner under the spousal transfer rules and he would indeed "inherit" her PRR back to the date it started (presumably the date she purchased it) 

mills1983

Thank you all for your help with this - the sale has now finally completed, and so we now have 60 days to work this out. I'm just wondering, how much would it cost to get someone to sort this out for us, e.g. a tax advisor or an accountant? 

Cheers

mills1983

Can I also use my CGT allowance, as we were married at the time of the sale, and so it was a joint asset?
Thanks

Bookworm105

mills1983 said:

Can I also use my CGT allowance, as we were married at the time of the sale, and so it was a joint asset?
Thanks

being married does not make you a co-owner unless the legal ownership was amended to record that fact before the date of sale. 
take note of earlier replies regarding impact of marriage 

if it was jointly owned then by definition you must each do your own CGT declaring relating to your respective share. Earlier posts have already shown that calculation, including use of CGT allowance. 

mills1983

OK thanks - What if she gifts me some of the Gain - does that then come off her gain and I can put in my own calcualtion?

Bookworm105

mills1983 said:

OK thanks - What if she gifts me some of the Gain - does that then come off her gain and I can put in my own calcualtion?

for goodness sake stop asking mad scenarios.
do you really not understand the most basic aspects of tax? You pay tax on your own financial position, you cannot give that way to make someone else pay your tax 

answer the questions
- who are the legal owners and from what date? 
- when did you marry?

mills1983

She's been the legal owner throughout, we married in 2023.
Thanks for your help

Bookworm105

mills1983 said:

She's been the legal owner throughout, we married in 2023.
Thanks for your help

then the gain is 100% hers ONLY
moving money between you does not alter her tax liability as you have zero liability on a property you do not own