Capital Gains Tax - Help?!

map200uk

Hi guys,

My father owns a house which he is selling, it used to be his dads - but he passed away. The house has been in my dads name for quite a number of years, and all was fine, until suddenly this dirty topic of 'Capital Gains Tax' arose-whereby we are liable to pay tax on the increase in value from when my dad was given the house....years ago until now?

The thing is, my dad was going to use 1/2 of the proceeds from the sale for a deposit for me, and 1/2 for my sister-so obviously this hugely hinders us.

I was wondering, is there anyway to pay less, limit it or anything we can do which can help? I can't believe everyone pays it

I suspect it's a case of the normal people pay-whilst the no good people, as normal-find a way round it


Mark

CLAPTON

does you father live in the house or has he or what is the situation with the house?

map200uk

no he does not he lives elsewhere

silvercar

has he ever lived in it (at least while it was in his name has he lived in it)?

There is something called dependent relative relief. I'm a bit hazy on the details but it may apply in your case.

map200uk

no he never registerred it as his main house

so we could be stuck giving the gov yet more money?

silvercar

if your dad acquired the house before the demise of your grandfather and before April 1988 he can claim dependent relative relief, providing your grandfather was in need of support.

If that doesn't apply, then I suggest you post the value at the time your dad acquired it and the date and its value now.

To make use of individual CGT allowances, it may be worth him passing a third to you now and a third to your brother after 5 April, so gaining a CGT allowance each time. These thirds will be assumed to be at market value.

Then the sale will mean you can use your CGT allowances (though you will have little capital gain if you sell after a short time.

map200uk

his dad was in need of support-however my dad was 200 miles away living elsewhere


il find the value of house now

thanks