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bigduckontax
bigduckontax, Accountant
Category: Tax
Satisfied Customers: 10398
Experience:  FCCA FCMA CGMA ACIS
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I wanted some help on CGT - my parents moved into my home 11

Customer Question

hi
JA: Hello. How can I help?
Customer: i wanted some help on CGT - my parents moved into my home 11 months ago and would like to rent their former residence out (currently unoccupied for renovations) - what are the CGT implications?
JA: Where are you? It matters because laws vary by location.
Customer: uk
JA: What steps have you taken so far?
Customer: nothing so far - as property has needed repair work
JA: Anything else you want the Lawyer to know before I connect you?
Customer: no thanks
Submitted: 1 year ago.
Category: Tax
Expert:  bigduckontax replied 1 year ago.

Hello, I am one of the experts on Just Answer and pleased to be able to help you with your question.

Presumably this residence is their sole or main domestic residence?

Customer: replied 1 year ago.
hi - they only have that one property. where they live now is my property - their name does not appear.
Expert:  bigduckontax replied 1 year ago.

They will be liable to CGT for the period of ownership against total ownership time and for the last 9 months of ownership they will be deemed to be in residence even if this is not the case and Private Residence Relief (PRR) extended.

Customer: replied 1 year ago.
what happens if they rent it out in the next 3 months and then sell it in say 5 years time?
Expert:  bigduckontax replied 1 year ago.

Then they will be liable for GCT on part of their gain depending on the time in occupation against the total ownership time.

Customer: replied 1 year ago.
would the best thing to do be to get a valuation on the property prior to renting so it helps later down the line?
Expert:  bigduckontax replied 1 year ago.

Quite un-necessary, CGT rules assume value rises evenly with time. We all know that tis is not true, but that is how it works.

Customer: replied 1 year ago.
got it thx
Expert:  bigduckontax replied 1 year ago.

Delighted to have been of assistance.

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