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TonyTax
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15950
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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My mother moved from her owner occupied house,purchased in

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My mother moved from her owner occupied house,purchased in Sept 1967, into a care home in June 2007.For the last four years approx all care home fees have been paid as she fell under the Continuing Health Care provisions whilst at the same time enjoying receipt of pensions(state and civil service) which i understand were still payable notwithstanding care home costs being fully paid for.
She died on Sept 10th 2015 and has left all her property,including the house to myself.The property has not been rented out following her move to the care home.
Could you advise me on the tax implications if any.
Thank you.
David West
Submitted: 2 years ago.
Category: Tax
Expert:  TonyTax replied 2 years ago.
Hi. You don't pay tax on inheritances. The estate executor will have to settle all debts including Inheritance Tax if there is any such liability and then the balance of the assets can be transferred to the beneficiaries of the estate. If the house is sold by the estate, there will only be any Capital Gains Tax to pay if the net of selling costs disposal proceeds exceed the sum of the value of the property on 10 September 2015 and the annual CGT exemption which the estate will be entitled to for the tax year of death and each of the following two tax years. If the house is transferred to you and you then sell it, there will only be any Capital Gains Tax to pay if the net of selling costs disposal proceeds exceeds the sum of the value of the property on 10 September 2015 and the annual CGT exemption which you are entitled to of £11,100. I hope this helps but let me know if you have any further questions.
Customer: replied 2 years ago.
Thank you for that. All her property ,including the house ,will be under the IHT threshold in any case. I was concerned that some CGT might have been payable covering the period between three years after going into the care home and her death,which was a little over 4 years. I understand from your advice that this 3 year rule only applies if the property would have been sold prior to her death.If i now live in the property and subsequently sell would CGT still be payable on a future sale?
Expert:  TonyTax replied 2 years ago.
There can be no CGT unless an asset, a property in this case, is sold or given away.
If you move into the property and live in it for the entire period of your ownership before you sell it or you sell it within 18 months of moving out there can be no CGT under the current tax rules. Take a look at HS283 for more information:
https://www.gov.uk/government/publications/private-residence-relief-hs283-self-assessment-helpsheet
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Customer: replied 2 years ago.
Many thanks.
Expert:  TonyTax replied 2 years ago.
Thanks.
Would you mind rating my answer before you leave the site please.