CGT on sale of flat

[JOHNRE]

Hello everyone, my wife will soon be selling a flat and we would appreciate some help with the CGT calculations. We have researched the .gov.uk website but things aren’t explained that well! Here are the details….

Purchase price £242000 (2014), never been PPR
Likely sale price £275000
Profit = £33000

Costs associated with purchase and sale = £10000
Wife’s personal CGT allowance = £12300

Profit, after costs and allowance = £10700

Now, in this current year, she will have NO taxable income. Question, will she be able to offset this £10,700 against her personal tax allowance of £12,750?

Thanks for any feedback.

[JOHNRE]

I should have said….I appreciate that my wife could transfer a % of the ownership over me and I could also use my CGT personal allowance but I would prefer not to have to do that….

[Jholm]

It's a separate allowance so she will still her the £12,570 personal allowance available.

[JOHNRE]

So, the CGT liability cannot be offset against her personal income tax allowance?

[Jholm]

Nope, annual exemption is for CGT. Personal allowance is for income tax. They are not interchangeable, otherwise most people would claim their unused AE as an extension to their PA.

[JOHNRE]

We might need to look at transferring part of the ownership then….