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TaxRobin, Tax Consultant
Category: Tax
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Experience:  International tax
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My mother signed over her house to me in 2003. She is now in

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my mother signed over her house to me in 2003. She is now in a care home.I have been on the electoral register and paid council tax at the property for the last 5 1/2 years. what would be my C.G.T. liability be if I sold it for 250,000.My annual income will only be about 2,000 next tax year.
HelloBecause the property is not your residence you will pay CGt on the gain you would receive (less your allowance).You have a tax free allowance of £11,100. To work out your gain you need to know the market value when your mother signed it over to you. You can deduct costs of buying, selling or improving your property from your gain. These include:estate agents’ and solicitors’ feescosts of improvement works, eg for an extension (normal maintenance costs don’t count, eg for decorating)The difference in your market value (less the deductions) and the 250,000 will then tell you if you have a gain.Then subtract your allowance. That is the amount you would pay tax on.You’ll either pay 18% or 28% tax on your gains if you’re a basic rate taxpayer.
Customer: replied 2 years ago.
The fact that for 5 1/2 years it has been my `Official Residence` does not matter or does it cloud the waters? I would guess the value 2003 would be 200,000 therefore tax on 50,000?
If it is your personal residence then you can claim relief.You don’t pay Capital Gains Tax when you sell (or ‘dispose of’) your home if all of the following apply:you have one home and you’ve lived in it as your main home for all the time you’ve owned ityou haven’t let part of it out - this doesn’t include having a single lodgeryou haven’t used part of it for business onlythe grounds, including all buildings, are less than 5,000 square metres (just over an acre) in totalyou didn’t buy it just to make a gainYou don’t need to do anything. You’ll automatically get a tax relief called Private Residence Relief. You would not be taxed on the gain.
Customer: replied 2 years ago.
I am already aware of the points you have just posted,but have only `Officially` lived there from 2010 to the present
You must have actually lived in the home as your only or main residence at some point while you owned it.If you did not then you cannot claim relief under the above even if you attempt to nominate this property as your main home."Officially" living there is different then actually living there. If you did not live in the property then you need to follow the information I listed previously and you will have a gain of 50,000 then reduce by £11,100 for your allowance. £38900
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