Husband and wife lived in a house (bought for £80,000) in 1997 until 2007. They were unable to sell, so it was let out. As the husband was a HRIT, he transferred 49% to wife by deed of gift and completed form 17. So the wife declared 99% of rental income in her tax return and husband 1%. In 2019, they are thinking of selling (MV £300,000) before the changes in PPR/letting relief in 2020. The wife would like to transfer back to husband 49%, so they both own it 50:50. The total net gain is £220,000. In order to calculate the PPR, would the husband effectively be treated as owning 50% for the whole period, so his net gain is £110,000; his PPR including last 18 months is £58,500, letting relief is £40,000, AEA £12,000, so all the gains are wiped out. The wife's calculation would be similar.
or do I have to calculate the gain on a day by day basis according to the % ownership at the time?
Thank you in advance for any advice.