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TonyTax
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15708
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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I am the executor of my Aunt's estate which the only

Customer Question

I am the executor of my Aunt's estate which the only monetary asset is a house that was in an extremely bad state of disrepair structurally and internally.
My Mother is the main beneficiary, my question is as follows:
I've paid a builder with no receipt at regular intervals throughout a two year plus period - now as the house is going on the market I have increased the value of the property significantly after all payments. I've asked my builder to produce a final bill, labor only so I can claim back against the estate.
How would he go about framing the bill as it's been over a two year plus period as the builder has been paid in regular intervals once each job has been completed. Or, am I overthinking this and ask my builder to put the total +VAT and leave it at that.
Many Thanks - I won't be liable for any tax as I won't benefit from any monetary gains.
Submitted: 3 months ago.
Category: Tax
Expert:  TonyTax replied 3 months ago.

Hi. My name is*****'m looking at your question now and will post my answer or ask for more information here in a short while.

Expert:  TonyTax replied 3 months ago.

As the gain from the sale of the property can only be taxed in one tax year, you just need a figure for the labour costs from the builder. It would be helpful if he could provide some detail of the work done as HMRC may ask for proof of the expenditure. Are you not claiming for the cost of materials and fixtures and fittings?

The estate only qualifies for a CGT exemption for the tax year of death and each of the following two tax years. It will also pay CGT at 28%. If your Mother is a basic rate taxpayer, it might be worth putting the property into her name before it is sold so as to benefit from the 18% CGT rate on at least part of the taxable gain.

I hope this helps but let me know if you have any further questions.

Customer: replied 2 months ago.
Hello Tony,
I am claiming for fixtures and fittings to get my outlay back against the sale of the property. I will not be claiming the VAT back as I cannot get a monetary gain as I am the executor of the property.I have kept every receipt structural engineering report photos for before and after from the build, though as previously stated over the 2+ year period. Therefore would that be okay seeing as the receipts are spread over the 2+ year period for the total labor costs to be allocated into one tax year.Many Thanks
Expert:  TonyTax replied 2 months ago.

That's fine.

Expert:  TonyTax replied 2 months ago.

Hi.

I'm just following up to find out if my answer helped or if you have any further questions.

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