Selling the girlfriend's house after we get married.....?

[Mr Noble]

My GF owns a property that's been empty since she moved in with me about 8 months ago.

We get married in September and she wants to sell it. It will then be a "2nd" home.

If we still own it aswell as our marital home when she sells it, will it have to incur CGT on the profits since purchase or would HMRC give us a break as under the circumstances?

The plan was to sell it before we tie the knot, but everything has been so busy we just haven't go round to it, and now it's looking like it's too late to get the sale complete before September 2nd.

[HootersGsy]

Is it her "main" home at the moment? If so I doubt you'll have any tax to pay as she'll get relief for the period it was her principal primary residence plus you get a further 3 year period which should cover your time to sell. Even then, as a married couple you would be able to share your CGT allowances if necessary.

[anonymous-user]

Assuming it's in her name ownly, then any capital gains will be hers alone.

As has been posted above though, the last 3 years of ownership are CGT free no matter what. So as long as the house is sold within 3 years of it not being her primary residence then there will be no CGT to pay.

Where there may be an issue is if you are both purchasing a new residence to live in. For her it will be a second property and will attract additional property stamp duty.

[schmunk]

** Note: The "last 3 years" is now "last 18 months" - this change happened in April 2014 **


There are other reliefs potentially available but, given the above should still cover the OP's situation, I won't go into them.

[anonymous-user]

schmunk said:

** Note: The "last 3 years" is now "last 18 months" - this change happened in April 2014 **


There are other reliefs potentially available but, given the above should still cover the OP's situation, I won't go into them.

Thanks for the update on the changes.

[Mr Noble]

Thanks for the help guys.

Yes it's her primary and only property.

We intend to sell it before I sell my primary residence and we buy a house together (me with £400k of equity and her with about £15k )

We did consider renting it but it's not worth paying the additional 3% on the family house we will buy together.

[A205GTI]

Taken from gov website this may help

1. Private Residence Relief

You don’t pay Capital Gains Tax when you sell (or ‘dispose of’) your home if all of the following apply:

you have one home and you’ve lived in it as your main home for all the time you’ve owned it
you haven’t let part of it out - this doesn’t include having a single lodger
you haven’t used part of it for business only
the grounds, including all buildings, are less than 5,000 square metres (just over an acre) in total
you didn’t buy it just to make a gain

by the looks of it you have to self assessment the claim. so you should be ok.

[Ari]

Mr Noble said:

We intend to sell it before I sell my primary residence and we buy a house together (me with £400k of equity and her with about £15k )

Good luck.

[Pheo]

Get a prenup in place given the very large disparity between assets. Can recommend lovegrovefamilylawyer.uk - a friend of mine admittedly. She sees many breakups where a prenup would have made things much kinder, quicker and easier on everyone.

[Ari]

Are prenups binding in the UK? I didn't think they were.

Good advice if so, but won't be taken because 'she's not like all the rest'.

Just like all the rest weren't....

[crouchingpigeon]

I believe they used to be pretty much disregarded in the UK. These days they are not legally binding but useful as guidance during court proceedings. Definitely worth consulting with a family lawyer before making the purchase, maybe not a pre-nup but there could be something else they could draw up specifically in relation to the house.