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CGT on sale of property
edited 12 November 2021 at 7:19PM in Deaths, funerals & probate
25 replies 1.6K views
I have applied for probate today, with a net valuation of the estate coming out at £150K under the £625K available threshold so IHT is extremely unlikely to become an issue.
The deceased's residence was valued at £300K for probate purposes. It probably won't be sold until spring 2022 so there is the possibility of sale prices rising between now and then.
Say the house sells for £320K, giving a capital gain (ignoring any allowable expenses) of £20K.
1. Am I correct that the estate has an allowance of £12,300, so CGT would be due on £6,700? And that the rate of CGT would be 28%, so £1,876 would have to be paid within 30 days of the sale?
2. Is it normal for the solicitor handling the sale to also do the CGT calculation and pay it out of the sale proceeds, or is the MSE-friendly option to do it yourself?
3. Almost certainly hypothetical - If the capital gain was a lot higher, say £100K, would it be cost effective to vary the Will to transfer ownership to some or all of the beneficiaries (basic rate taxpayers) first so that their own allowances and lower CGT rates could be used? Obviously this would only make sense if the tax saving is greater than the cost of transfer.
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