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TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15977
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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I inherited my mums house 5 years ago .I paid Iht tax valuation

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I inherited my mums house 5 years ago .I paid Iht tax valuation was 350000 borrowedborrowed 137 000 to buy my place let out the property till this day want to sell now valuation is about 660000 how much cgt will I pay

Has the property you inherited ever been your main home?
Customer: replied 2 years ago.

It was mums place but did live there with partner about 20 years ago


Leave this with me while I draft my answer.
Hi again.

Assuming the property had a probate value of £350,000 and it has not been your main home during your ownership of it, then you will make a taxable gain of £310,000 (£660,000 - £350,000). You can deduct the costs of selling (legal fees, selling agent fees etc) from the gain. The first £11,100 of gains you make in 2015/16 will be tax free.

There are two rates of Capital Gains Tax, 18% and 28%. The rate or combination of rates that you will pay will be dependent on the level of your income in the tax year that you sell it. Assuming that happens in the current tax year, one of the following scenarios will apply:

1 If your income in 2015/16 including the net taxable gain is £42,385 or less, then all the net taxable gain will be taxed at 18%.

2 If your income alone in 2015/16 is £42,385 or more, then all the net taxable gain will be taxed at 28%.

3 If your income in 2015/16 excluding the net taxable gain is less than £42,385 but more than £42,385 when you add the net taxable gain, then part of the net taxable gain will be taxed at 18% and part at 28%.

I hope this helps but let me know if you have any further questions.
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Customer: replied 2 years ago.

Its a good answer I made mistake I borrowed 237000 will that make a difference when I sell house

The borrowings have no impact on the calculation of the gain.