Capital Gains Tax - sale by executors

Executors are selling deceased’s home - can they claim expenses under SP02/4 as well as the estate agents and solicitors fees directly relating to the sale.

The amount that is claimable under SP02/4 is higher than the actual costs involved.

Thank you in advance


The Statement of Practice deals with the costs of establishing title [TCGA s.38 (1) (b)]

TCGA s.38 (2) would permit the deduction of estate agents’ and solicitors’ fees directly relating to the sale.

I was also looking into this point recently. I couldn’t find a solid answer but did find the following comments on another forum -

TCGA 1992 s 38 makes the position wrt costs deductible on an asset disposal for CGT purposes very clear.

S38(1)(b) specifically provides for a deduction of “any expenditure wholly and exclusively incurred by him in establishing, preserving or defending his title to, or to a right over, the asset”.

SP2/04 specifically provides " the scale of expenses allowable under Taxation of Chargeable Gains Act (TCGA) 1992 s 38(1)(b), for the costs of establishing title in computing the gains or losses of personal representatives on the sale of assets comprised in a deceased person’s estate".

Incidental costs of acquisition and disposal are deductible under s 38(1)(a) and (c) in addition to costs covered by SP2/04.

Malcolm Finney

I believe that the allowance under SP2/04 is more commonly known as the Re Richards allowance – se also the HMRC CGT Manual at CG30560 and CG30570.

As Malcolm states, this allowance is in addition to the actual costs of the disposal.

Paul Saunders FCIB TEP

Independent Trust Consultant

Providing support and advice to fellow professionals

Yes provided the property is still in the estate and has not been appropriated to a beneficiary first (to use their own CGT allowance)