Hypothetical DIVORCE to avoid CGT

[anonymous-user]

Hypothetical Person A has property X purchased some 25 years ago for £60K now valued at £360K therefore £300K gain.

Property was lived in for 5 years as PPR
Property was 'let' to a family member who has lived in it for 20 years (rent free)

Person A now lives with wife B but not owner of marital home Y.

Person A would like to dispose of X without paying £100K in cgt

Can we divorce, Person A makes property X their PPR, sells it and then remarries B (maybe C....)

A is not on property Y and wife B is not on property X.

Or should A gift share of property to B and AB children ab in order to benefit from 4 x CGT reliefs?

[46and2]

You could just pay the tax

[LooneyTunes]

46and2 said:

You could just pay the tax

You never know, other half may have put him up to this and be planning on running off as soon as he's put loads of assets in her name...

[CharlesElliott]

AnotherUsername said:

Or should A gift share of property to B and AB children ab in order to benefit from 4 x CGT reliefs?

CGT is for the person making the gain, not the people receiving it. If you gift property, it is deemed to have been done at market value so you will have to pay CGT on the gifted portion.

[ozzuk]

Why not just take the cash, pay the tax and pat yourself on the back for a good investment - your 'return' is the profit after tax/other costs, 260k coming your way is not bad.

[Simpo Two]

This is how you do it... https://www.youtube.com/watch?v=y6QgHUJIQ5Q

[xeny]

Hmm, I'm now thinking about a sequence of deathbed marriages to avoid inheritance tax.

[NickCQ]

Amazing that this property has increased in value from £300k to £360k in the space of one morning

[anonymous-user]

I always have a load of hypothetical questions and debates with my accounts meeting. Keeps the grey matter fresh.

He’s told me many a story of people marrying a few days before dying as well as those who gift assets before death and then people go and die in the wrong order!

[Skyedriver]

NickCQ said:

Amazing that this property has increased in value from £300k to £360k in the space of one morning

Well the rate of inflation is around 7% taken over the last week or so....

[46and2]

Skyedriver said:

NickCQ said:

Amazing that this property has increased in value from £300k to £360k in the space of one morning

Well the rate of inflation is around 7% taken over the last week or so....

Must have a few buyers interested

[anonymous-user]

So, get divorced and move into 2nd property to make it a PPR, flog it. Get married