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Aston Lawyer
Aston Lawyer, Solicitor
Category: Law
Satisfied Customers: 10458
Experience:  Solicitor LLB (Hons) 23 years of experience in Conveyancing and Property Law
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Im selling my mum and dads house, both now deceased. It was

Customer Question

I'm selling my mum and dad's house, both now deceased. It was purchased for 18k in 1974 and is going to sell for approx 320k. They lived in it the whole time. What will the cgt position be for the 3 beneficiaries? Thank you
Submitted: 3 years ago.
Category: Law
Expert:  Aston Lawyer replied 3 years ago.

Hello and thanks for using Just Answer.

My name is ***** ***** am happy to assist you with your enquiry.

Sorry to ask, but could you confirm if your last parent has only just died or has the property been left empty for years/your parents died some time ago?

I look forward to hearing from you.

Kind Regards

AL

Customer: replied 3 years ago.
My mum died last Monday. The house was put into joint names for ownership with my mum, sister and me when my dad died 8 years ago.
Expert:  Aston Lawyer replied 3 years ago.

Hi Carol,

Thanks for your reply.

The CGT position is-

There will be no CGT payable on your Mother's share of the property (as the only tax payable on death is Inheritiance tax).

There will be CGT to pay on yours and your sister's share on the basis that neither of you have been living there since you acquired your respective shares 8 years ago.

This is calculated as follows- you will need to ascertain the market value of your share at the time you acquired it 8 years ago. Any increase in the market value of your share from the date you acquired it to the date you sell is the figure used to calculate the CGT.

So, if for example this figure is £100,000, you would have CGT to pay at 18% or 28% for higher rate tax payers. You can however, deduct your annual allowance

for the current financial year (£11,000) and last year's financial year (£10,900), provided you have not already used them.

So, if you have not used either of the annual allowances, the sum of £21,900 can be deducted from the figure of £100,000. This leaves you with a CGT payment of £71,800 x your tax rate (being 18% or 28%).

I hope this sets out the legal position to you and asissts.

You should of course speak to an Accountant if you so wish, once the property has been sold.

Kind Regards

AL

Aston Lawyer and other Law Specialists are ready to help you
Customer: replied 3 years ago.
For Aston, thank you for your answer. So does each of us use a cgt allowance, so 11k for me and 11k for sue? My brother is left one third of the house too but is not named as an owner alongside sue and I, does he use his allowance too?
Expert:  Aston Lawyer replied 3 years ago.

Hi Carol,

Yes, both you and Sue can use your annual exemptions for each of your respective shares.

There won't be any CGT for your brother to pay as he has never owned a share in th ehouse and is purely inheriting his due share.

I hope this helps.

Kind Regards

AL

Customer: replied 3 years ago.
Ok, it's becoming clearer now, thank you. Would I be right in thinking that if the whole estate is less than the iht threshold then there is no tax due.
Expert:  Aston Lawyer replied 3 years ago.

Hi Carol,

You are correct in that if your Mother's share of the property added to all her accounts etc is under the IHT threshold ther ewon't be any tax payable on her Estate.

Kind Regards

AL