Share this page:
Stay connected:
Welcome to the Citywire Money Forums, where members share investment ideas and discuss everything to do with their money.

You'll need to log in or set up an account to start new discussions or reply to existing ones. See you inside!

Notification

Icon
Error

transferring capital gains tax to spouse
christine sanders
Posted: 20 January 2013 16:42:47(UTC)
#1

Joined: 20/01/2013(UTC)
Posts: 6

Thanks: 2 times
If I sell land that was left to me in my fathers will, can I transfer half of the cash value that I get for it to my husband so that he can use his capital gains annual allowance and also only pay the lower amount ie 18% capital gains tax on the remainder.
If so how do I go about doing this as initially the money will be paid to me.

thanks for any advice
Roger Hutton
Posted: 20 January 2013 16:53:42(UTC)
#2

Joined: 01/08/2010(UTC)
Posts: 11

Was thanked: 6 time(s) in 4 post(s)
The short answer is no. To achieve what you want you will need to transfer a half share in the land to your husband BEFORE you sell.
2 users thanked Roger Hutton for this post.
christine sanders on 20/01/2013(UTC), Guest on 27/01/2013(UTC)
christine sanders
Posted: 20 January 2013 17:02:29(UTC)
#3

Joined: 20/01/2013(UTC)
Posts: 6

Thanks: 2 times
Thanks for the prompt reply - the land is in the process of selling, hoping to be sold by April/May time this year, to transfer half the ownership - do I need to get in touch with Land registry - do you need to get a solicitor involved? I presume it all has to be done as a legal procedure.
Roger Hutton
Posted: 20 January 2013 17:43:29(UTC)
#4

Joined: 01/08/2010(UTC)
Posts: 11

Was thanked: 6 time(s) in 4 post(s)
I suggest you instruct a solicitor - using the same one for the transfer and the sale should save you money
1 user thanked Roger Hutton for this post.
christine sanders on 20/01/2013(UTC)
christine sanders
Posted: 24 January 2013 09:14:52(UTC)
#5

Joined: 20/01/2013(UTC)
Posts: 6

Thanks: 2 times
Hi

If land being sold was valued at £30000 in 2002, is that you value one can deduct for Capital Gains purposes or do you use todays' value ie + inflation.

If a deposit is paid ie 10% of the value of purchase to a solicitor but the sale doesn't go through until the following tax year, can the deposit be used for previous year tax purposes even if held with the solicitor and not paid to the seller until sale complete.

Can you carry forward last years capital gains allowance if not used, or any previous year if you had owned the land for 10 years without using capital gains allowance.

Thanks for any advice



Roger Hutton
Posted: 24 January 2013 16:37:44(UTC)
#6

Joined: 01/08/2010(UTC)
Posts: 11

Was thanked: 6 time(s) in 4 post(s)
You stated that the land was left to you in the will - in which case, the value of the land is the that at the date of the death ie the value used for probate - this is the 'cost' to you.

The next section is copied from the Which? web site

Home example

For example, you inherit your father’s home when he dies in May 2008.
At the date of death, it is worth £200,000.
You sell it six months later for £205,000 and can deduct selling costs of £3,000.
You have made a gain of £205,000 - £200,000 - £3,000 = £2,000

The value for selling is the actual amount in the sale (assuming that it is a 'real' sale - ie. not an artificially low price for example when perhaps selling to a relative of yours)

The deposit is not a sale - the sale is the complete price for the land including the deposit and is effective when ownership is transferred.

CG allowance cannot be carried forward.
christine sanders
Posted: 24 January 2013 16:50:23(UTC)
#7

Joined: 20/01/2013(UTC)
Posts: 6

Thanks: 2 times
Thank you very much Roger - if we spent £1500 this year on a solicitor for a sale that didn't take place, can that be carried forward as a loss to next year when hopefully the sale will take place.

My sister lives is USA and has done for 10 years but is still a uk citizen, am I right in thinking that as she emigrated after 1998, she will have no capital gains to pay.

If I earn taxable income of £17000, am I right in thinking that I can use the remaining up to the threshold at 18% and then after that it will be 28%.

I have done quite a bit of research on this but sometimes get confused by the jargon.

Thanks again.

Roger Hutton
Posted: 24 January 2013 17:20:53(UTC)
#8

Joined: 01/08/2010(UTC)
Posts: 11

Was thanked: 6 time(s) in 4 post(s)
re the £1500 - I think it can be counted as a cost - you should check further to be safe - also have you made any improvements/changes to the land - these could be costs as well. I think simple maintenance eg grass cutting would not be.

re your sister - don't know

re 18% tax - yes

Please note - I am not an expert - I simply have to pay CGT each year so have learnt a little.
christine sanders
Posted: 24 January 2013 17:28:22(UTC)
#9

Joined: 20/01/2013(UTC)
Posts: 6

Thanks: 2 times
thanks for your help
Jack Belfitt
Posted: 27 January 2013 09:49:08(UTC)
#10

Joined: 16/08/2012(UTC)
Posts: 1

Thanks: 2 times
According to contemporary opinion is not the proposed intention to avoid paying tax on this transfer most imoral and should not those advising how this is to be done equally dishonourable? Or on the other hand are those advocating this revised attitude to taxation utterly stupid?
Redundant (Old Timer?)
Posted: 27 January 2013 12:45:00(UTC)
#11

Joined: 07/01/2010(UTC)
Posts: 31

Thanks: 9 times
Was thanked: 7 time(s) in 6 post(s)
Re your sister.

As the land is in the UK potentially she could be subject to CGT. She will also most likely be subject to US tax as a US resident. Citizenship is not important, residence is. However, relief is probably available under the US:UK double tax treaty to avoid her suffering double taxation. Your sister should research or take advice on this.

As by the sound of things, some of the proceeds are being sent aboard, who never pays the share to your sister may also like to double check that HMRC does not require any UK withholding tax to be deducted.

+ Reply to discussion

Markets

Other markets