How JustAnswer Works:

  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.

Ask Sam Your Own Question

Sam
Sam, Accountant
Category: Tax
Satisfied Customers: 13657
Experience:  26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
16196420
Type Your Tax Question Here...
Sam is online now

My husband is a kuwaiti national who has been resident in the

Customer Question

My husband is a kuwaiti national who has been resident in the uk from October 2009. He has sold his flat in kuwait and has bought a house in both our names here in the uk. The flat was bought in 1995. We lived in the flat in kuwait together untill 2005 when I left with the children and came to live in the uk. We were seperated and I was a single parent untill 2009 when he came here and settled. The house sold in June 2013. What capital gains tax are we liable for please ?
Submitted: 2 years ago.
Category: Tax
Expert:  Sam replied 2 years ago.
Hi

Thanks for your question, my name is Sam and I am one of the UK tax experts here on Just Answer.

Did the flat remain in your husbands sole name throughout ownership and was it let out (rents received) from 2009 when your husband moved out, and June 2013 when it was sold. If so was the rental income brought into the UK and declared to HMRC.

I ask these questions so I can establish who the liability is on, and what tax reliefs are due to reduce the gain.
What month in 1995 was the flat bought
What month in 2009 did your husband come to the UK
If the flat was in joint names, what month in 2005 did you come to the UK

I can then provide you with a calculation you can apply to the figures.


Thanks

Sam


Customer: replied 2 years ago.
The flat was in my husbands sole name. It was not rented out when he moved here. It was bought in June 2002. Thanks
Expert:  Sam replied 2 years ago.
Hi Huda

Thanks for your response

Then the capital gain will arise on your husband only (as the flat was in his sole name) you first advise the flat was bought in 1995 - then you advise June 2002? I assume you mean the house you bought - which I do not need the information on.

The capital gain is worked out as follows

The purchase price is deducted from the sale price - this forms the initial gain.

From this initial gain - deduct the costs to buy and sell (so any legal fees or estate agency fees) and the costs of any capital improvements, such as new kitchen, new bathroom.

The figure left over is then considered for exemptions due to the time that your husband lived there, which was from 1995 to 2009 (so approx. 164 months) so this time plus the last 36 months of ownership form exemption under the private residence relief rules - so a total of 200 months.
The flat was owned from 1995 to June 2013 - so approx. 216 months so the gain left over can have 200/216 x gain to form the exemption.

With any figure left over, the first £10,900 is exempt, and any remaining figure is liable to capital gains.

The rate of capital gains will either be 18% or 28% or a mix of the both, and this depends on what your husbands annual income is -

Thanks

Sam

Customer: replied 2 years ago.
Sorry to be thick but what does 200/216 x gain mean ? Thankyou
Expert:  Sam replied 2 years ago.
Hi

Thanks for your response

The 200 reflects the time your husband lived in the property + the last 36 months of ownership and the 216 reflects the total ownership period (estimated as you did not supply the month in 2009 that your husband left the property)

Thanks

Sam
Customer: replied 2 years ago.
Yes sorry. But how does that work put as a sum. Is it 216-200 x the amount of gain What does the / stand for. Do I x it by the total amount of money gained?
Expert:  Sam replied 2 years ago.
Hi

The / denotes a fraction so 200/216ths of the overall gain SO

It will be the gain divided by 216 and then times by 216 - the resulting figure then provides what amount of the gain can be considered exempt (to represent the time your husband lived there AND the last 36 months of ownership)

Hope that helps

Thanks

Sam
Customer: replied 2 years ago.
Did you mean and times 200 ?
Expert:  Sam replied 2 years ago.


Thanks for your response

Sorry yes its divided by 216 then times 200

Thanks

Sam

Customer: replied 2 years ago.
Thankyou. That's been a real help. It's all so confusing. I will be filing this return in January. With the releif still be 36 months or will it change ?
Expert:  Sam replied 2 years ago.
Hi

As the sale took place before 05/04/2014- then it will be 36 months - its just for sales that have taken place after 05/04/2014 that only get the additional 18 months relief (as opposed to the current 36 months)

If when you actually come to fill in the capital gains section of the self assessment tax return - you want to check your calculations, then do come back to Just Answer, and you can always ask for me Sam tax - and I would be happy to help.
If you ask for me in your opening sentence of you new post, then the other experts will allow me to answer (and if they don't and you would prefer to wait for me - I am online every day) then just let them know.

Thanks

Sam

What Customers are Saying:

 
 
 
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C.
< Previous | Next >
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C.
  • This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!! Alex
  • Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult. GP
  • I couldn't be more satisfied! This is the site I will always come to when I need a second opinion. Justin
  • Just let me say that this encounter has been entirely professional and most helpful. I liked that I could ask additional questions and get answered in a very short turn around. Esther
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C.
  • This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!! Alex
 
 
 

Meet The Experts:

 
 
 
  • Sam

    Sam

    Accountant

    Satisfied Customers:

    6894
    26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
< Last | Next >
  • http://ww2.justanswer.com/uploads/TA/Tax Expert/2013-8-21_231010_sam.64x64.jpg Sam's Avatar

    Sam

    Accountant

    Satisfied Customers:

    6894
    26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
  • http://ww2.justanswer.com/uploads/BI/bigduckontax/2013-8-12_222058_1.64x64.jpg bigduckontax's Avatar

    bigduckontax

    Accountant

    Satisfied Customers:

    1772
    FCCA FCMA CGMA ACIS
  • http://ww2.justanswer.com/uploads/TA/TaxRobin/2013-8-28_16186_femalebusinessprofessionalbinderhand11038485.64x64.jpg TaxRobin's Avatar

    TaxRobin

    Tax Consultant

    Satisfied Customers:

    464
    International tax
  • /img/opt/shirt.png taxadvisor.uk's Avatar

    taxadvisor.uk

    Chartered Certified Accountant

    Satisfied Customers:

    2596
    FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
  • http://ww2.justanswer.com/uploads/MS/MsAM/2012-6-9_16426_anna.64x64.jpeg Anna's Avatar

    Anna

    Teacher, writer, biologist

    Satisfied Customers:

    268
    Great research skills, variety of work experiences, teaching experience.
  • http://ww2.justanswer.com/uploads/PD/pdheslin/2012-6-6_232056_pambig.64x64.jpg pdheslin's Avatar

    pdheslin

    Consultant

    Satisfied Customers:

    51
    20+ years of internet site creation and search engine optimization. Dozens of search tools at my disposal.
 
 
 

Related Tax Questions