Hi. I’m seeking some guidance on an account regarding two issues: Capital gains tax liability and conveyancing.
In brief,
Husband and Wife held a property as tenants in common (Form A restriction). Upon W’s death, some years ago, her beneficial half share of the residence was left to their 4 children in the will. No trust was mentioned or actioned.
However, no change of ownership was ever registered with HM land Registry and no Death of joint proprietor was ever declared (DJP). No further administration of the estate was done, and the husband continued to live in the property alone until his passing recently. He left his half share of the house, and residue of estate, to their children also.
Only H was executor of W’s will. 2 children are named executors of H’s will.
1)Given that their father has now passed and the 4 children wish to sell the property, what would be best practice in regards to conveyancing?
I intend to submit DJP and TR1 simultaneously. Appointing the executors as trustees in order to overreach the beneficial interest in W’s estate. Would this be correct? Am I missing something?
2)Where does the Capital gains tax liability fall? A confirmation/ clarification of this would be appreciated.
Given the above, it is my understanding that the children are liable for CGT on the difference between the value of W’s half share upon death, and what it now sells for. I.e. The house was valued at time of W’s death at 650k, giving her a half share amount of 325k. If the house sells for 800k, her half share has risen in value by 75k and is therefore liable to CGT.
Between the 4 children they will have to declare 18,750 each.
The house sale is unlikely to be finalised before FY and therefore should benefit from the lower 3k CGT allowance coming in to affect after April 5th. Leaving around 15k to declare.
Thanks in advance for any comments
John