Proceeds of House Sale
Discussion
Sorry, this is another PH "I've got too much money" thread. In fairness, rare for me 
My wife owned a house before we married. She subsequently let it out and is now in the process of selling it. At no point have we ever put the house in my name or the finances of that property anywhere near my accounts because we have very different tax positions (she currently earns below personal allowance).
When the funds are released from the sale, they will be greater than her ISA allowance and so we'd like to put a portion of it in my unused tax free allowance. Can anyone see any problem with that? And is it OK for that to occur before the CGT settlement (which we'll obviously do pronto but only based on her tax position as I've been nothing to do with the property)?
Plan is to use the money to renovate our home in 12 months or so: not looking for longer term investment
TIA
My wife owned a house before we married. She subsequently let it out and is now in the process of selling it. At no point have we ever put the house in my name or the finances of that property anywhere near my accounts because we have very different tax positions (she currently earns below personal allowance).
When the funds are released from the sale, they will be greater than her ISA allowance and so we'd like to put a portion of it in my unused tax free allowance. Can anyone see any problem with that? And is it OK for that to occur before the CGT settlement (which we'll obviously do pronto but only based on her tax position as I've been nothing to do with the property)?
Plan is to use the money to renovate our home in 12 months or so: not looking for longer term investment
TIA
Yes she can but bear in mind she's effectively gifting you the money. She can't demand it back (of course you can choose to give it to her)
In terms of the CGT it's irrelevant whether she gifts you the money before or after she submits the CGT return. AIUI she has 60 days from the date of sale to let HMRC know and to pay the amount owed.
In terms of the CGT it's irrelevant whether she gifts you the money before or after she submits the CGT return. AIUI she has 60 days from the date of sale to let HMRC know and to pay the amount owed.
. Which my wife isn't.jrb43 said:
Thank you all. Yes, plan was to describe the transaction (and subsequent kitchen purchase) as gifts. Thanks for the reassurance.
Just curious - who would you need to describe the transactions to and why? HMRC don't care what you or your wife do with your money as long as you've paid the tax on it.Countdown said:
Just curious - who would you need to describe the transactions to and why? HMRC don't care what you or your wife do with your money as long as you've paid the tax on it.
My post was born out of a state of paranoia: the rent from her house has always gone to my wife's separate account so it can't be confused with my income and she will be disposing of her asset to attract CGT at basic rate. Despite giving them healthy donations on a monthly basis, and filling out comprehensive SA, I'm always fearful that HMRC will take further interest in money appearing in my account - legitimate though it is!
This will be the first time the house has, in any way been associated with me and I wanted a sanity check
jrb43 said:
My post was born out of a state of paranoia: the rent from her house has always gone to my wife's separate account so it can't be confused with my income and she will be disposing of her asset to attract CGT at basic rate.
Despite giving them healthy donations on a monthly basis, and filling out comprehensive SA, I'm always fearful that HMRC will take further interest in money appearing in my account - legitimate though it is!
This will be the first time the house has, in any way been associated with me and I wanted a sanity check
Fair enough. The same thing happened to my nephew - he was getting £2k a month from his wife. HMRC asked to see his wife's statements and they could see that she was declaring all her income so it was very straightforward.Despite giving them healthy donations on a monthly basis, and filling out comprehensive SA, I'm always fearful that HMRC will take further interest in money appearing in my account - legitimate though it is!
This will be the first time the house has, in any way been associated with me and I wanted a sanity check
ferret50 said:
Countdown said:
Fair enough. The same thing happened to my nephew - he was getting £2k a month from his wife. HMRC asked to see his wife's statements and they could see that she was declaring all her income so it was very straightforward.
Toy boy?His account is the ones the bills go out plus they’re saving for a bigger house of so that’s her contribution.
C69 said:
Slightly O/T and you're probably already aware, but if your wife lived in the house before letting it, then she'll be eligible for some Private Residence Relief for GCT purposes. If that's the case, then don't forget the last nine months either.
Yes, thank you. Mercifully the period it's been let is relatively small compared with the time it was her primary (only as it happens) residence so the CGT hit is unpleasant but not intolerable.Gassing Station | Finance | Top of Page | What's New | My Stuff