property capital gains tax for married couples

I original bought a property in 2006 and lived in it for 4 years then rented it out for the remainder. in the meantime I got married and my wife and I bought our first home together which is our main residency. A few years ago I gifted my wife 50% of the rental property. We have now sold the rental. For the capital gains tax form does my wife treat the calculations of the private residence relief and all other calculations as if we had bought the property together in 2006. ie the figures will be the same on both forms.

Hi
Yes that is correct,see guidance at :
Capital Gains Tax: what you pay it on, rates and allowances

My wife and I are separated and I moved out of our primary home many years ago. My name is currently on the deeds. If I remove my name (which I am happy to do) and she remains the sole owner, would I still be subjected to any CGT when she sells the property in the future? Thank you

I called up and spoke to an agent, they advised me that CG22240 would be valid to work out the calculation. so when the transfer took place the property was valued and therefore the calculation would be between the transfer date value and the sale value for my wifes calculation.? https://www.gov.uk/hmrc-internal-manuals/capital-gains-manual/cg22240

Hi David,

You may in fact be liable to capital gains when you transfer your share into her name as you have been separated for a number of years.

Capital Gains Tax: separation and divorce

Thank you.

Hi benjiw,

You do not pay Capital Gains Tax on assets you give or sell to your husband, wife or civil partner, unless:

• you separated and did not live together at all in that tax year
• you gave them goods for their business to sell on

The tax year is from 6 April to 5 April the following year.

If they later sell the asset, your spouse or civil partner may have to pay tax on any gain if they later dispose of the asset.

Their gain will be calculated on the difference in value between when you first owned the asset and when they disposed of it.

If this was before April 1982, your spouse or civil partner should work out their gain using the market value on 31 March 1982 instead.

They should keep a record of what you paid for the asset.

Thank you.

 

My wife has owned a property since 2011 and wwe lived there together until November 2020. In November 2020 She gifted 50% of that property to me and we moved out to a new property. We rented or the original house from November 2020 until we sold it recently. When we fill in the CGT form I have declared that I was ‘gifted’ 50% of the property and stated the value of the 50% at the time and it’s value at the time of our recent sale. The value has gone down a little. So am I only liable for gains after the 50% was gifted to me? And When my wife fills in her form, does she enter the value of 50% of the property when she bought it (2011), and 50% of the recent sale value? Does my wife only pay CGT on 50% of the house over the whole ownership period (even though She only signed half of it to me in 2020)?

My wife has owned a property since 2011 and wwe lived there together until November 2020. In November 2020 She gifted 50% of that property to me and we moved out to a new property. We rented or the original house from November 2020 until we sold it recently. When we fill in the CGT form … 1. I have declared that I was ‘gifted’ 50% of the property and stated the value of the 50% at the time of the gift (2020) is that right? 1a. Or should I enter the original (2011) price when my wife first bought it as the value it was gifted at. And 2. When my wife fills in her form, does she enter 50% of the property price when she bought it (2011), and 50% of the recent sale price?

3. I see that the value I put in is at the ‘time of acquisition’. This is on November 2nd 2020 when 50% was gifted to me. The value of the property was higher at that time than the amount we sold it for. Does that mean I don’t have to fill the declaration in because I have no capital gains in that time? 4. Does my wife (who owns the other 50% and lives with me) only pay CGT on her 50% from when she bought the property in 2011? Or will she have to pay CGT on 100% of the property between 2011and 2020 (or2023) Apologies for the multiple questions. It’s confusing me

Hi PLH Louis,

As you have now sold the property, your purchase price is 50% of what your wife paid for it in 2011 and not the value at the time of the transfer.
Please see guidance at Capital Gains Tax: what you pay it on, rates and allowances

Thank you

But in ‘acquisition details’ section the form it asks ‘How did you get the property’ and I have answer ‘Got it as a gift’ (on 2/11/2020). It then asks ‘What was your share of the market value of the property on 2 November 2020’ . And not what the value was when it was originally bought by my wife (In 2011).

And we were living in the property as our main residence at the time and had been for over 7years.

Hi
You can claim private residence relief for the period you lived in it -
HS283 Private Residence Relief (2023)

Hi
The date you acquired it is treated as the date your wife purchased it and not the date of the transfer.
See link given in previous reply.

Ok, so we are both able to use our £6000 allowances against the gains (Less private residence relief) from the whole period that my wife has owned the property? i.e. 2011-2023? …

Hello; my wife and I are separating; she is to stay in our residence (moved in since we bought it) and I will move in our buy-to-let property (none of us lived in that house before). Because the separation is amicable she has gifted her share of the buy-to-let to me and I have gifted my share of our home to her. In 18 months, I will finish my business here and want to go and live abroad, so I will sell the house I am moving in and it was our buy-to-let before. Now, if she does the same she won't pay CGT, because it's classed as home / residence, but if I sell, I will be charged CGT for the period the property was rented out. We did not foresee our separation and now she gets to pay no CGT and I get to pay a substantial CGT. Why ? That's not fair. My accountant told me that I won't have to pay CGT at all if we have lived together during the tax year that the asset was transferred, which is true, but I don't believe him. Is he correct, please?

Hi PLH Louis
Private residence relief is deducted before applying the annual exempt allowance.  
Both of you can apply the £6000 annual exempt allowance agains your proportion of the gain.

Hi Adam,
New rules have come into effect and you now have 3 years from separation/divorce for capital gains to start.
Please refer to:
Capital Gains Tax: separation and divorce
Thank you. 

Hello @ HMRC Admin 25, Thank you for your reply, but I think that I have put too many questions at the same time and your answer does not clears my matter; Let me keep it simple, please: so, my wife and I have separated this autumn, amicably we decided that I transfer her my share of our home (let's call it house A) and she gets to keep living here and I have moved to our buy-to-let property (let's call it house B) and she transferred her share of house B to me. Let's say that I decide to sell house B and my simple question to you is: do I have to pay CGT ? Regardless if your answer is yes or no, I would very much appreciate a brief reason why if it's yes and why if it's no. Thank you in advance,

Hi,
 

This forum is for guidance only and if after reading the guidance I gave the previous link you are still unsure, you will need to contact HMRC directly on 0300 200 3300 or speak to a financial adviser . Thank you .