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Where Taxpayers and Advisers Meet

declaration of trust and CGT

petergibbinson
Posts:159
Joined:Wed Aug 06, 2008 3:53 pm
declaration of trust and CGT

Postby petergibbinson » Tue Nov 13, 2018 12:14 pm

I purchased an investment property in Jan 2012 (mortgage free) - join names with my wife (50:50 ownership)
The property was then changed to 99% beneficial ownership to my wife and 1% to me via a declaration of trust (in 2014) via a solicitor, and form 17 filled out and accepted by the HMRC. Rental income then split 99% and 1% for tax purposes.
Property then sold in 2018 and capital gains tax due on the profit - how do I apportion this? - simply in the 99%/1% ratios? Or do I apportion for time that it was 50% vs 99%/1%?
What about the costs (e.g stamp duty and solicitors fees, estate agents fees)? Do I split these 50%/50% for the period before the declaration of trust - or are all costs treated 99%/1% ? i.e when we purchased it the stamp duty was 50%/50% - or do we split those costs 99%/1% even though the declaration of trust didn't exist when the property was purchased ?

AdamS93
Posts:268
Joined:Tue Sep 26, 2017 6:28 pm

Re: declaration of trust and CGT

Postby AdamS93 » Tue Nov 13, 2018 1:53 pm

You split it based on the beneficial ownership so 99%/1%.

The costs are split on the same basis. You effectively sold the majority of your share in the property to your wife at nil gain/nil loss in 2014.


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