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 taxadvisor.uk Your Own Question
taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 4978
Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
54961312
Type Your Tax Question Here...
taxadvisor.uk is online now

I inherited a flat in London in 2007 after death of my civil

Customer Question

I inherited a flat in London in 2007 after death of my civil partner. I paid no inheritance tax at the time as the property was valued just below the limit at which tax became payable. It has not been my main residence
I can not find the relevant documentation but i believe it was valued at £35,.000. I now hope to sell it and apparently it is very likely to sell for £500,000. Can you advise me on how capital gains is calculated and what sort of sum I would be liable for
Submitted: 2 years ago.
Category: Tax
Expert:  taxadvisor.uk replied 2 years ago.

Hello and welcome to the site.

Thank you for your question and requesting I help you with it.

The threshold for inheritance tax in tax year 2007-2008 was £300,000 and let's say that the property value was £299,000.

Let's say you make a gain of (499,000-299,000) = £200,000

As this has never been your main residence the whole gain would be chargeable to CGT.
Let's also assume you have other income and that you are on the border line between basic rate and higher rate tax band and that his gain when added to your other income would put you into higher rate tax band.

This being the case, your CGT rate would be 28% and your maximum exposure to capital gain tax would be (200,000 x 28%) = £56,000.

I hope this is helpful and answers your question.

If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.

Related Tax Questions