Quick CGT comp checking.
Client received flat by way of gift from mother Aug 1995, value £79k.
Lived in it until May 2000, left flat and it has been rented as residential investment property since then.
Nov 03 transferred by way of gift a half share in flat to brother, no CGT was reported then (quick check confirms it was covered by PPR and AE).
May 11, Brother purchases her 50% interest for £125k, this being half the independent valuation of £250k
I calculate the gain as follows:
|Disposal of 50% interest oin Investment Property|
|Proceeds||125,000||Market Value of flat is £250k|
|Costs incidental to disposal||-2,000||Legals and ehnancements|
|Cost of Property||-39,500||Initial Cost from 1995 is £79k|
|36/189||PPR, last 36 mths||-15,905|
|132/189||Letting relief (time)||-58,317|
|Letting relief (max)||-40,000|
|Letting relief (limit to PPR)||-41,087|
|Lower of above||-40,000|
|Gain before AE||2,413|
|Less Annual Exemption (2011/12)||-10,600|
|Chargeable at 28%||0|