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TonyTax
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My mother gifted her flat to my brother and myself in Nov

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My mother gifted her flat to my brother and myself in Nov 2008 and moved into sheltered housing and at that time it's market value was around £90,000. We did not pay her anything for the flat and have not lived in it since we were kids (were now both in our 60's ). We've had the flat rented out since then but recently decided to sell it. It sold for £75,000.in Oct 2016. Is this a gain since we paid nothing for the flat or a loss since it's value has dropped.are we liable to pay any CGT ?
Submitted: 7 months ago.
Category: Tax
Expert:  TonyTax replied 7 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 7 months ago.

The cost of the flat for CGT purposes is £90,000, its value when it was gifted to you. Therefore, as you sold it for £75,000, each of you and brother have made a capital loss of £7,500 so there can be no CGT. You can add the costs of selling the property (legal fees, selling agent fees etc) to the loss.

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

Expert:  TonyTax replied 7 months ago.

I have to go out for a while but will be back to answer any follow up questions you may have.

Customer: replied 7 months ago.
Thank you - just one thing - do we need to inform hmrc ?
Expert:  TonyTax replied 7 months ago.

It's worth reporting to HMRC so as to establish the capital loss you have each incurred. If you don't do that within four years of the end of the tax year in which you make the loss, you won't be able to use it against any taxable capital gains you may make in the future.

TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15885
Experience: Inc Tax, CGT, Corp Tax, IHT, VAT.
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