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taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 4973
Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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My father gave me and my sister his home 3 years ago. We have

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My father gave me and my sister his home 3 years ago. We have just sold it for £100k. What is our tax liability?
Submitted: 1 year ago.
Category: Tax
Expert:  taxadvisor.uk replied 1 year ago.
Thank you for your question...Please advise- what was the value of the property when it was gifted/given to you by your father? Many thanks
Customer: replied 1 year ago.
£100k
Customer: replied 1 year ago.
i.e. same as sale no change in value since the gift
Expert:  taxadvisor.uk replied 1 year ago.
Thank you for your prompt reply. As there is no gain on sale, there will be no CGT liabilty.You have stated that the property has just been sold.You would have to report the sale on supplementary pages SA108 - capital gains summary of your tax return 2016 (year ending 5 Apr 2016) as the sale proceeds were more than £44,400 but there is no chargeable gain. 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.
So each of us is not liable for any tax whatsoever even though we received the property as a gift?
Expert:  taxadvisor.uk replied 1 year ago.
Thank you for your reply.As you received the property as a gift, gifts are received free of tax in the hands of the recipient under UK tax.The valuation at the time of gift becomes your cost price and any gain from that is chargeable to CGT. I hope this is helpful.
Customer: replied 1 year ago.
So if I received the property for £0 cost, then my gain is 50% of £100k, i.e. £50K. Would I then be liability for GCT on the £50K?
Expert:  taxadvisor.uk replied 1 year ago.
You received a property that had a value of £100k when it was gifted to you.Although you did not pay anything for it (because it was a gift) for CGT purposes the valuation of the gift would form the cost price £100k (not the actual amount paid which was £0).If your share is 50% then you gain is 50%. I hope this is helpful and anwers your question.
Customer: replied 1 year ago.
Ok so there is no other tax liability, i.e. IHT when my father dies?
Expert:  taxadvisor.uk replied 1 year ago.
Thank you for your reply.IHT is payable if the estate exceeds the threshold for IHT when one dies.If your father survives for 7 years from the date of giving away the property to you, then this gift would be exempt from his wealth for IHT purposes. Otherwise the value of it would be added to other assets he held at the time of death to establish whetherthe total exceeded the threshold (£325,000 currently) or not. I hope this is helpful and answers your question.If there are no more issues, I will appreciate if you would kindly rate my service/accept the service I have provided before you leave the site, to ensureI get credited for it by Just Answer.
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Customer: replied 1 year ago.
It would have been a more robust answer if you had mentioned IHT in one of your responses.
Expert:  taxadvisor.uk replied 1 year ago.
Your question was -My father gave me and my sister his home 3 years ago. We have just sold it for £100k. What is our tax liability? You had asked what taxes you have to pay as you have sold the property for £100k.I have given you the correct answer.

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