Hi All,
We are thinking about doing a transfer of equity transaction including our property and would like to hear an advice about capital gains tax implications.
At the moment, the property is owned jointly by me and my wife.
The property was acquired by my wife and her ex-husband in June 2001 for £121k
She lived in the property until December 2004, at which point a transfer of equity from her ex-husband to me was performed, with property being evaluated at £200k at the time.
From that point onwards, the property has been let out - and a few years ago, we have acquired another property, which makes the original one subject to a capital gains tax in case of a sale or equity transfer.
At this point, we are planning to add my parents to the title.
The property is currently valued at £300k, and they are going to pay us £150k for essentially half of the property.
What are the capital gains implications for us in this scenario ?
My calculations will show:
1) Me selling quarter of the property, which value has risen from £50k to £75k, which results in capital gains tax of £3,836.00
2) My wife selling quarter of the property, which value has risen from £30k to £75k, over 16 years, from which she was living in the property for 3 years, resulting in capital gains tax of £6,916.00
Is that about right or am I missing something ?
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