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  • FIRST POST
    • Dobeylove
    • By Dobeylove 4th Dec 19, 12:09 PM
    • 3Posts
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    Dobeylove
    CGT on inherited property
    • #1
    • 4th Dec 19, 12:09 PM
    CGT on inherited property 4th Dec 19 at 12:09 PM
    As part of a Court Agreement If an inherited property is sold 3 years later for less than it was valued at Probate, would the person who inherited it pay CGT on the uplift in value since Probate? Although it is a gain in value, it's money that hasn't been received.
    Also would the Estate be able to claim back IHT if the property were sold for less?
    Last edited by Dobeylove; 04-12-2019 at 2:03 PM.
Page 1
    • purdyoaten2
    • By purdyoaten2 4th Dec 19, 2:03 PM
    • 1,049 Posts
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    purdyoaten2
    • #2
    • 4th Dec 19, 2:03 PM
    • #2
    • 4th Dec 19, 2:03 PM
    No. However if it is sold to a ‘connected person’ at less than market value the sale proceeds would be deemed to be that market value.

    A very simplistic answer which will be no doubt elaborated upon by those more expert than I.
    • Keep pedalling
    • By Keep pedalling 4th Dec 19, 3:40 PM
    • 7,220 Posts
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    Keep pedalling
    • #3
    • 4th Dec 19, 3:40 PM
    • #3
    • 4th Dec 19, 3:40 PM
    As part of a Court Agreement If an inherited property is sold 3 years later for less than it was valued at Probate, would the person who inherited it pay CGT on the uplift in value since Probate? Although it is a gain in value, it's money that hasn't been received.
    Also would the Estate be able to claim back IHT if the property were sold for less?
    Originally posted by Dobeylove
    I presume you meant to say is sold for more the probate value, in which case CGT will be payable if the gain exceeds the beneficiaries annual allowance, unless the beneficiary had been using the house as their primary residence in which case it would be exempt.
    • purdyoaten2
    • By purdyoaten2 4th Dec 19, 6:56 PM
    • 1,049 Posts
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    purdyoaten2
    • #4
    • 4th Dec 19, 6:56 PM
    • #4
    • 4th Dec 19, 6:56 PM
    I presume you meant to say is sold for more the probate value, in which case CGT will be payable if the gain exceeds the beneficiaries annual allowance, unless the beneficiary had been using the house as their primary residence in which case it would be exempt.
    Originally posted by Keep pedalling
    Clearly you are less cynical than I. I just detected an attempt to avoid CGT by selling at undervalue.
    • Keep pedalling
    • By Keep pedalling 4th Dec 19, 8:42 PM
    • 7,220 Posts
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    Keep pedalling
    • #5
    • 4th Dec 19, 8:42 PM
    • #5
    • 4th Dec 19, 8:42 PM
    Clearly you are less cynical than I. I just detected an attempt to avoid CGT by selling at undervalue.
    Originally posted by purdyoaten2
    No I just read it differently, but you reading is the correct one
    • Dobeylove
    • By Dobeylove 11th Dec 19, 1:23 PM
    • 3 Posts
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    Dobeylove
    • #6
    • 11th Dec 19, 1:23 PM
    • #6
    • 11th Dec 19, 1:23 PM
    Thanks for your reply.
    The property was sold for less than the Probate value as part of a Proprietary Estoppel claim.
    • Dobeylove
    • By Dobeylove 11th Dec 19, 1:28 PM
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    Dobeylove
    • #7
    • 11th Dec 19, 1:28 PM
    • #7
    • 11th Dec 19, 1:28 PM
    Theres no avoidance of paying CGT. This was part of a settlement for Proprietary Estoppel whereby I gave money to the executors/beneficiaries of my mothers Estate who agreed to transfer the ownership of her property to me. This exchange of money was less than the market/probate value. Would the Executors/beneficiaries be liable for CGT?
    • xylophone
    • By xylophone 11th Dec 19, 2:56 PM
    • 31,705 Posts
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    xylophone
    • #8
    • 11th Dec 19, 2:56 PM
    • #8
    • 11th Dec 19, 2:56 PM
    Is the case that you were not actually left the property in your mother's will?

    Or you were left only a part interest?

    Or there was an intestacy and you were only entitled to a share of the value?

    Despite the above, at some stage you were promised the property and relied on the promise?

    https://www.forsters.co.uk/news/blog/proprietary-estoppel-claims-lessons-recent-case-law

    The court has ordered that the property must be transferred to you but that you must make a payment for it?

    The payment is below market value and below probate value?

    It is up to the executor/administrator to establish the tax position?
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