IHT and Joint Tenant Property

SVaz

You’ve made this faaaar more complicated than it needs to be.
Not sure why you even bothered thinking about IHT,  the estate is way under the limit.
As for probate,  unless there are valuable works of art/antiques/ jewellery,  £500 for the whole contents is sufficient. 

If the house is sold,  there may be CGT to be paid as it was jointly owned but not lived in for a while by one owner -    It’s now only 9 months ‘grace’ rather than the 3 years it used to be.  

Jesus_take_the_wheel

SVaz, writing it down and talking it through via the forum has been helpful for me. There is one question still not answered, though I guess I can phone IHT and ask them as I complete the form. 

Can I ask what you mean by 9 months grace rather than 3 years  and does capital gains tax apply to anything that might be sold as part of the estate (not just property)?

SVaz

CGT is only due when property etc. have risen in value and it can be offset by conveyancing and Estate agent fees. 

It used to be that someone who owned but stopped living in a property had 3 years before CGT became due in the event that the value had risen and the property sold. 

It’s now only 9 months.
As for other goods, I know that classic cars are exempt,
 I don’t imagine that normal jewellery or household goods would go up in value.  Perhaps a valuable watch collection might. 

https://www.litrg.org.uk/savings-property/capital-gains-tax#:~:text=As%20noted%20above%2C%20CGT%20applies,We%20discuss%20exempt%20assets%20below.

NorthYorkie

SVaz said:

CGT is only due when property etc. have risen in value and it can be offset by conveyancing and Estate agent fees. 

It used to be that someone who owned but stopped living in a property had 3 years before CGT became due in the event that the value had risen and the property sold. 

It’s now only 9 months.
As for other goods, I know that classic cars are exempt,
 I don’t imagine that normal jewellery or household goods would go up in value.  Perhaps a valuable watch collection might. 

https://www.litrg.org.uk/savings-property/capital-gains-tax#:~:text=As%20noted%20above%2C%20CGT%20applies,We%20discuss%20exempt%20assets%20below.

Jewellery, household goods, personal items are 'chattels' (i.e. tangible moveable property) and are exempt from Capital Gains Tax if sold for less than £6,000. There are special rules for 'sets' of chattels, basically where the collection is worth more than the sum of the individual items.
All cars are specifically exempt, not just classics.

Jesus_take_the_wheel

To quote "It used to be that someone who owned but stopped living in a property had 3 years before CGT became due in the event that the value had risen and the property sold".

Apologies, I still don't understand what the 3 years and 9 months is referring to. Are you suggesting that CGT will need to be paid within 9 months of selling the property (if it is sold)?

Does time of selling make a difference to CGT. For example, if sold 5+ years after the person passed away is CGT still liable?

mybestattempt

Jesus_take_the_wheel said:

To quote "It used to be that someone who owned but stopped living in a property had 3 years before CGT became due in the event that the value had risen and the property sold".

Apologies, I still don't understand what the 3 years and 9 months is referring to. Are you suggesting that CGT will need to be paid within 9 months of selling the property (if it is sold)?

Does time of selling make a difference to CGT. For example, if sold 5+ years after the person passed away is CGT still liable?

As it's a UK residential property if/when it is sold/disposed of by the daughter any capital gain and capital gains tax due must be reported to HMRC and paid within 60 days.

When the capital gain is calculated part of this will attract private residence relief as the daughter lived there for a period of time. The private residence relief is based upon the actual period plus nine months.

SVaz

You used to get 3 years after moving out before any gains attracted CGT on the sale,  now you only get 9 months on top of the period you actually lived there. 

So,  Now - live there 20 years,  move out for 3 years before it’s sold,  you only get 9 months of that 3 years to discount any gain.  

Which means it’s likely there will be CGT due, even after knocking off allowable costs.