Capital Gains Tax

[thesaint sfc]

Hi Guys,

 

Wondered if anyone knew the answer to this - it would be really appreciated.

 

In 2009 I became joint owner of my mums house which was 100% paid for. We then re-mortgaged part and bought another house which is solely in my name. I then had a mortgage of £150k which is nearly paid off.

 

My Mum is now looking to sell her house which is still in our joint names. I have two properties in my name.

 

Do I need to pay CGT on the sale of her property? Considering all the money made from the property will be my mums I don't see why I should have to pay capital gains tax when I haven't made a gain!

 

Is there anything we could do to avoid this? For example if I paid off the remainder of the mortgage and put the ownership of the property back into her name?

[Batman]

Hi Guys,

 

Wondered if anyone knew the answer to this - it would be really appreciated.

 

In 2009 I became joint owner of my mums house which was 100% paid for. We then re-mortgaged part and bought another house which is solely in my name. I then had a mortgage of £150k which is nearly paid off.

 

My Mum is now looking to sell her house which is still in our joint names. I have two properties in my name.

 

Do I need to pay CGT on the sale of her property? Considering all the money made from the property will be my mums I don't see why I should have to pay capital gains tax when I haven't made a gain!

 

Is there anything we could do to avoid this? For example if I paid off the remainder of the mortgage and put the ownership of the property back into her name?

 

No. Tax avoidance is the devil

[thesaint sfc]

I'm not talking about tax avoidance. As I'm not making a gain its more paperwork sorting so its clearer for HMRC. Thanks for your input though.

[Batman]

I'm not talking about tax avoidance. As I'm not making a gain its more paperwork sorting so its clearer for HMRC. Thanks for your input though.

 

yeah yeah

 

 

 

 

[CB Saint]

Technically you would have to pay CGT as it isn't your principle private residence.

 

However if your mum is going to keep the entire proceeds of the sale, then maybe you can gift your share to your mum prior to the sale and the she can sell tax free as it is her principle residence. You might want to get some advice, but I think it might fly.

 

the only proviso is that you have to survive 7 years. It worked for Cameron mum.

[Weston Super Saint]

Hi Guys,

 

Wondered if anyone knew the answer to this - it would be really appreciated.

 

In 2009 I became joint owner of my mums house which was 100% paid for. We then re-mortgaged part and bought another house which is solely in my name. I then had a mortgage of £150k which is nearly paid off.

 

My Mum is now looking to sell her house which is still in our joint names. I have two properties in my name.

 

Do I need to pay CGT on the sale of her property? Considering all the money made from the property will be my mums I don't see why I should have to pay capital gains tax when I haven't made a gain!

 

Is there anything we could do to avoid this? For example if I paid off the remainder of the mortgage and put the ownership of the property back into her name?

 

Well, technically, you have 'gained' from the property as the mortgage that was taken out on it enabled you to buy the other property....

 

Since you are 'joint' owner wouldn't you only be liable for the tax on your 'share' of the gain?

 

Can you not transfer what is left of the mortgage on to your other property and then relinquish your share of the property to be sold, but would the legal fees involved in doing that be less than the capital gains tax??

 

It's a minefield so I'd get proper legal advice....

[trousers]

Why not just give the money to the Exchequer? That way you get to help build hospitals and stuff.

 

Edit: apologies, that wasn't very helpful. Ignore me!

[Jonnyboy]

Why don't you funnel any profits into a shell company in the Caribbean, then you'll both pay zero tax on the whole shebang plus it's better for this great country.

 

Edit - ignore that it's what n*bheads do.

[Saint-scooby]

I use these people

 

http://www.mossfon.com/

 

They take cash, diamonds, flesh etc as payment

[buctootim]

I love it that someone who owns three houses signed up to be joint owner of his mums house so he can be super smart and avoid inheritance tax is now facing CGT cos Mum fancies a cruise or other good time.

[OldNick]

I suspect you owe the tax. You will of course be able to take off your allowances for each year.

It will be worth using a decent accountant, it may cost a grand or so but they will save you more than trying to get advice on here. I use HWB accontants, they seem to be pretty on the ball

Edited 24 April, 2016 by OldNick

[thesaint sfc]

I love it that someone who owns three houses signed up to be joint owner of his mums house so he can be super smart and avoid inheritance tax is now facing CGT cos Mum fancies a cruise or other good time.

 

I'm not. When I was 19 I saved up enough money to put a deposit down on a house for about £150k. When I looked for my first property I found a repossession which was only available as a cash purchase. As I didn't have the cash to pay for the whole house I gave what I had to my mum, she remortgaged her house so we bought a 3 bedroom house for me for a very good price. I've since been paying the mortgage off on her house. I own one house - the other house is my mums. That said, I wouldn't blame anyone for doing that if it saves them on the 'death tax' which I feel is completely unjustified - but that's a separate topic and another debate.

[buctootim]

I'm not. When I was 19 I saved up enough money to put a deposit down on a house for about £150k. When I looked for my first property I found a repossession which was only available as a cash purchase. As I didn't have the cash to pay for the whole house I gave what I had to my mum, she remortgaged her house so we bought a 3 bedroom house for me for a very good price. I've since been paying the mortgage off on her house. I own one house - the other house is my mums. That said, I wouldn't blame anyone for doing that if it saves them on the 'death tax' which I feel is completely unjustified - but that's a separate topic and another debate.

 

Fair enough, apologies. You should take Hutch's advice and get a consultation with a tax accountant because from a laypersons view it looks as though you could be liable.

[Trader]

I think the best thing you can do is seek legal advice on complex tax matters from a football forum.

[Whitey Grandad]

Are you joint tenants or tenants in common?

[eurosaint]

I'm pretty certain that only your prime residence (ie. The one you live in) is exempt from CGT !

This is irrespective of 'shared' ownership of other properties and I fear that you will have to pay at least a part of any increase in equity !

Stating the obvious, you do need professional advice but best not to build your hopes up IMO !

[Whitey Grandad]

I'm pretty certain that only your prime residence (ie. The one you live in) is exempt from CGT !

This is irrespective of 'shared' ownership of other properties and I fear that you will have to pay at least a part of any increase in equity !

Stating the obvious, you do need professional advice but best not to build your hopes up IMO !

 

You need proper advice, but if you have lived in the house as your main residence in the recent past this will help you considerably.