CGT help

[Nick67]

Need to help trying to work out the potential liability

Flat was bought in 2003 with Mr living there for a year

It has been rented out ever since

2007 jointly owned with wife

Original purchase price £121k, current selling price £150k

Am I right he will have 4/12 of the gain set aside/exempt?

What about the Mrs share?

Any help much appreciated

[Alpinestars]

Was it ever the Mrs' Principal Private Residence? If not, she'll be taxed in full on her share of the gain. Might reduce to nil with the annual exemption.

He should have no taxable gain.

[Nick67]

Alpinestars said:

Was it ever the Mrs' Principal Private Residence? If not, she'll be taxed in full on her share of the gain. Might reduce to nil with the annual exemption.

He should have no taxable gain.

Thanks for the reply

She never lived there. It was purchased in Dec 2003 so just over 11 years ownership

So if my maths is correct his would be £29k/2=£14.5k *8/11=£10,545 which is less than his allowance.

I assume we would need the value in 2007 when he passed over 50% to Mrs

[Alpinestars]

You'd have to work out the gain for both of them individually, so yes a valuation would be needed at the time they became joint owners.

He will get PPR and letting relief, and based on your numbers there should be no gain.

She will have a gain, no PPR type reliefs, but be able to use her annual exemption.

[Nick67]

Alpinestars said:

You'd have to work out the gain for both of them individually, so yes a valuation would be needed at the time they became joint owners.

He will get PPR and letting relief, and based on your numbers there should be no gain.

She will have a gain, no PPR type reliefs, but be able to use her annual exemption.

Thanks very much

[konark]

Can't buying and selling costs be taken into account to lessen the total gain?

[Claudia Skies]

konark said:

Can't buying and selling costs be taken into account to lessen the total gain?

Yes, and this includes Stamp Duty, which these days can be significant for some people. (Not relevant for OP though)