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Where Taxpayers and Advisers Meet

CGT due on reduced purchase price

Hove81
Posts: 7
Joined: Thu May 17, 2018 3:36 pm

CGT due on reduced purchase price

Postby Hove81 » Wed Jul 11, 2018 12:03 pm

I jointly own a BTL property with my Ex and he is buying me out.

When we purchased the property we paid a reduced purchase price as we were buying it from his father.

Am I correct in thinking that for CGT purposes we use the Value at the time of purchase not the price paid? If so it reduces my liability!

Also, am I correct i thinking that you cannot offset your valuation fee or mortgage fees? but you can offset solicitors fees and SDLT?

Many thanks

pawncob
Posts: 4143
Joined: Wed Aug 06, 2008 4:06 pm
Location: West Sussex

Re: CGT due on reduced purchase price

Postby pawncob » Wed Jul 11, 2018 12:42 pm

As it wasn't an arms length transaction, your FIL (?) should have declared his gain based on the MV at the time.

Your cost price will depend on whether you're married. If so, your half share would be subject to the MV adjustment. If not then it will be half the actual price paid.

Legal fees and SDLT can be offset against the gain (both purchase and sale)
With a pinch of salt take what I say, but don't exceed your RDA

Hove81
Posts: 7
Joined: Thu May 17, 2018 3:36 pm

Re: CGT due on reduced purchase price

Postby Hove81 » Wed Jul 11, 2018 12:47 pm

OK, thanks, We were not married so I'm presuming it will be the price paid then?


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