Probate Law/Capital Gains Taxgreenspun.com : LUSENET : Repossession : One Thread
This isn't to do with a repossession, I've previously had a repossession which is now settled (thanks to the help I received from this board!). I am in the process of buying the property I live in off my soon-to-be ex-husband. The problem is, he hasn't lived at the property for almost 4 years.
We need to know; are we liable for capital gains tax? If so, who is liable and what figure is it based on? He owes £78,000 on Mortgage, is selling it to me for £93,000 (plus an additional £15,000 payment to him when I sell the house) and the house is currently valued at approximately £165,000.
If anybody can help, or point us in the right direction, I would be very grateful. We have already asked 3 'experts' (including solicitors) all with differing advice! So it's a bit worrying that we may be stung for 40% tax and if we are liable for it, it will affect the settlement figure for the house that we have agreed.
-- firstname.lastname@example.org (email@example.com), September 29, 2004
its not a problem if he does not own another property. If he does then of course there can be a liability. however the liability is only on the profit. although the revenue could argue that this is a 'sale undercost' and make the appropriate adjustment. Is the house in joint names? if so he can only be profiting on his own half , also he can claim unused capital gains allowances over the last few years. See a good accountant.
-- roger watts (firstname.lastname@example.org), October 06, 2004.