Thanks for your question - I am Sam and I am one of the UK Tax experts here on Just Answer.
Yes you will be libale to capital gains tax, as
1) the transfer of the property will not take place in the year in which you separated and therefore
2) due to the fact it will be more than 18 months after you overfed out a capital gain will be considered
However for the time you lived there plus the last 18 months of ownership, this will form an exemption under the private residence relief rules
So say you have owned the half share of the propriety for 12 years, during which you lived there for 9 years then this 9 years plus the last 18 months of ownership will be exempt
So the capital gain will be 10.5 year/12 x profit made (value at transfer less purchase price)
And of course half the costs to buy (legal fees and any stamp duty) and half the costs of any capital improvements are deducted and you also have your annual exemption allowance, which currently allows the first £11,100 of the gain to be exempt.
if then any gain still remains, then this is either liable to 18% or 28% - depending in your annual income position and how much of the basic rate band you have unused.
Let me know if I can assist further
I am afraid there is no way to change the capital gain position - it is unfair I cannot disagree with you , but sadly as soon as 18 months lapse from the time this is deemed to be your residence, then capital gains comes into play.
This could have been avoided had an agreement regarding the property be drawn up in the tax year of separation, as then the legislation set would have been treated as arising in the same year - regardless of when the sale/transfer actually took place.
But on the plus side here value of the property when you do transfer/sell less the value at purcahse, will be small as its a recent purcahse (just over 2 years apprx)
So you are NOT liable to the £75,000 you hope to get - but 50% of the net value
So say you bought for £200,000 and when the transfer/sale takes place you get £300,000 then you considered as half of the profit which is only £50,000 (I appreciate you will just get 25% but as shared owner you are treated as 50% owner)
If there was no mortgage in place you could make an election now to reflect that the share is other than 50:50 - but you did indicate there was still a mortgage in place - but if its possible to change this the tax year PRIOR to that of the sale, then your capital gain position would be reflected on your actual legal share.
Let me know if I can assist further, but if you have all that you need, then it would be appreciated if you could rate me for the level of service I have provided (or click accept)