I am considering selling up my main residence and my 2nd property which my mother lives in and buying one big property for my family and my mum to live in together but I need to consider the impact of the CGT I will owe. I can’t work it out and the figure I’m coming up with is scary.
In July 2003 I bought house A with mum for £24k, property was valued at £60k, but we got a right to buy council discount on it. I paid all of the mortgage costs. My now husband also lived with us but did not own any part of it.
In April 2007 I moved out of House A and bought house B with H. I didn’t declare either of them as my main residence. Mum continued living in house A and didn’t pay anything towards the mortgage.
In January 2016 due to Mums age, she came off the mortgage and the ownership of the house, and I became 100% owner of House A. She still didn’t and still doesn’t contribute to the mortgage costs. At the time, House A was valued at £128k by the bank sorting the mortgage. I did not give Mum any cash for her transferring the the property solely in my name. This is because of the discount she gained for us and because she doesn’t pay to live there. She could be considered a dependent? I don’t know how that affects things.
I estimate that House A is now worth around £170k.
I work part time and earn approx £24k a year. So I know part of the gain will be taxed at 18% and part of it will be taxed at 28%.
How much CGT am I going to be liable for? I know I will be eligible for PPR for the time I lived there and the last few months of ownership, but I don’t know if owning 50% and then 100% has an impact on how it is worked out. I don’t know if I’m eligible for renting relief because mum never actually gave me any rent.
Also, is it possible to gift 50% of House A to my husband just before sale so that we can use his CGT allowance to offset £24k of the liability rather than just my £12k?
Is there anything else I haven’t considered?
Thank you for reading
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