House purchased in Sept 91 for 85,000. Owned 50/50 husband and wife. Legal fees and stamp duty of 1500
In May 96 they separated. The husband moved out.
On June 05 they divorced and in March 06 the husbands 50% was gifted 20% as settlement in the divorce to the wife and 30% to his eldest son. The bank estimated the property value at 215,000.
On Feb 2010 the mother and son who have always lived in the property moved out and it was rented until now. The house is due to sell in May 2017 for 350,000
Ex wife CGT:
50% of 85k + 1.5k = 43,250
20% of 215k = 43,000
70% share = 86,250
70% of 350k sale = 245,000
Capital gains = 158,750
Owned for 25.75 years
Lived in 18.5 years
Rented 7.25 years
Less PRR = 158,750 × (18.5+1.5)/25.75 = 123,301
158,750 - 123,301 = 35,449
Less lower or PRR, Letting relief and 40,000.
35,499 - 40,000 leaves a capital gains of Nil.
Sons CGT:
30% of 215,000 = 64,500
30% of 350,000 = 105,000
Capital gains = 40,500
Owned for 11.25 years
Lived in for 4 years
Rented for 7.25 years
Less PRR = 40,500 × (4+1.5) / 11.25 = 19,800
40,500 - 19,800 = 20,700
Less lower of PRR, letting relief and 40,000
20,700 - 19800 = 900
Less annual allowance brings taxable gains down to Nil
Does this look correct?
Have I used the correct value for the husbands share gifted in March 2006?
Also should the husband have been responsible for any CGT liability at that time? Or could this be transferred with the gifting of the property?
Replies (2)
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You asked this very question several days ago when you claimed to be the wife. You received several responses.
Now you, very oddly, ask the same question in the third person.
If you wish to clarify the responses you have already been given why do you not do so on the same thread, rather than starting a new thread pretending to be someone else.