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Capital Gains Tax

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If a property has been inherited by 3 sisters and in the will it is specified that their mother can live in the property until such time as she passes away or moves and the mother doesn't pay any rent, is capital gains tax liable when the time comes to sell the property?

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  • RAS
    RAS Posts: 35,730 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    One of the main reasons for creating an Immediate Post Death Interest trust in a will is that it protects the ultimate beneficiaries from CGT. As long as no-one tries to register the property in the ultimate beneficiaries' names. Not like the Land Registry would comply.

    The executor does need to register the Trust with HMRC within 2 years of the father's death.
    If you've have not made a mistake, you've made nothing
  • Keep_pedalling
    Keep_pedalling Posts: 20,993 Forumite
    Tenth Anniversary 10,000 Posts Name Dropper Photogenic
    No, this will be an immediate post death interest trust. Legal ownership is held by the trust, beneficial ownership by the widow. The children are classed as remaindermen and do not inherit until their mother dies or no longer needs the property. 

    Apart from avoiding GTG it also avoids any child loosing their first time buyer status if they do not already own their own home.

    Do the terms of the will allow your mother to downsize with the proceeds of the sale being used for the new purchase?
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