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taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
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Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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My father-in-law died in January, and left everything to his

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My father-in-law died in January, and left everything to his wife in his will (4 properties, all mortgaged). As part of the probate process we have just sold one of his properties to pay for various liabilities, this yielded £60k after the mortgage was paid off. My question is, is any CGT payable on this amount, and would it need to be reported on a SA99 form? My understanding is that there is no tax on anything passed to a spouse, but the property was sold before the probate process was completed.
Submitted: 1 year ago.
Category: Tax
Customer: replied 1 year ago.
For the sake of completeness, there are 3 other properties:1) The family home (which was in my father and mother-in-law's joint names), which our solicitor placed in his wife's sole name a few months ago. This is going to be sold too to pay off debts.
2) 2 flats, which are not being sold, but gifted as a PET (lifetime) to me and my wife, but my mother-in-law
Customer: replied 1 year ago.
(*by my mother-in-law), a typo in the last sentence.
Customer: replied 1 year ago.
(*SA99 - I meant SA900 form, sorry for another typo in the initial para)
Expert:  taxadvisor.uk replied 1 year ago.
Thank you for your question..You say the sale of property yielded £60k after the mortgage was paid off.The point to consider is whether the property fetched more than its valuation at the time of death or not. If sale proceeds exceeded valuation at time of death then the gain would be chargable to CGT Look at "When is Capital Gains Tax due"More information on this can be found herehttps://www.moneyadviceservice.org.uk/en/articles/calculating-and-paying-tax-after-someone-diesYou are correct in your understanding that there is no IHT payable if property/estate is passed to a spouse. 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.
Customer: replied 1 year ago.
That's really helpful.So, to put my mind at rest and to reconfirm your answer, any CGT only applies to the value of any of his assets which have INCREASED in value since the date of death?So the property we sold for £60,000 proceeds has not increased in value since he passed away, so I am I right in thinking that it is therefore not a chargeable gain, and therefore wouldn't need to be reported on the SA900?
Expert:  taxadvisor.uk replied 1 year ago.
Thank you for your reply Q5 refers to value of chargeable assets and as the value was more than £44,000 the answer is Yes. Tick against this question only ... and no more reporting.I hope this is helpful.
Customer: replied 1 year ago.
In Q5, there are 2 boxes saying 'Yes' - so we tick the top only, and that's the end of it?You've really helped, many thanks.I've just signed up to a membership, and have a couple more questions relating to dealing with this estate. You have helped me more in a few minutes than my accountant and solicitor have in months. Might I be able to ask you these questions? And if so, should I set up a brand new question, rather than adding them here?
Expert:  taxadvisor.uk replied 1 year ago.
Thank you for your reply...You are best advised to set up a brand new question...I hope I have been helpful.If you are happy and there are no more issues I will appreciate if you would kindly rate/accept the service I provided to ensure I get credited for it by Just Answer.
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Customer: replied 1 year ago.
Many thanks
Expert:  taxadvisor.uk replied 1 year ago.
I thank you for accepting my answer.Your reward of a generous bonus is greatly appreciated.Best wishes. Please look at SA905 (you may need to complete this as the value of disposal exceeded £44,000)https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/419868/sa905-2015.pdfMany thanks

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