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Posted Thu, 09 Jan 2025 06:31:25 GMT by RJMC13
My wife and I bought an investment property in joint ownership a few years ago with 50% / 50% ownership which we have recently sold and CGT is due. 4 tax Years ago 2020/21, we changed the ownership to 99% / 1% ownership in favour of my wife for income tax purposes. A declaration of interest was drawn up and issued by our solicitor, stating that we had become tenants in common and beneficial interest was now shared with that same % split. Furthermore, it stated that on sale of the property the net proceeds of the sale should be split with that same 99% / 1% ratio. One issue is that I no longer have access to the e-mail address that I previously used for official correspondence so cannot trace where this document was sent at the time, although I still have a copy myself. My question is: do I need to complete a CGT return for myself if there would be no CGT due or do we just complete one for my wife?
Posted Thu, 23 Jan 2025 17:00:03 GMT by HMRC Admin 25 Response
Hi RJMC13,
For tax purposes, by default, a husband and wife and civil partners, split the income / capital gain is split 50:50.
For HMRC agreement to alter this split, to apply the beneficial ownership ratio, a form 17 must be submitted to HMRC including a copy of the declaration, within 60 days of the form 17 being signed.
If you did not do this prior to disposing of the property, then Capital Gains Tax liability must be calculated at 50:50 split.
Please have a look at:
Declare beneficial interests in joint property and income
And
TSEM9862 - Property held jointly by married couples or civil partners: Form 17 rule - strict time limit
If you did submit a form 17 and it was formally agreed by HMRC, you will need to work out if your HMRC agreed share results in a capital gain.
If it does, you will need to report your gain within 60 days of the disposal date.
If you have no Capital Gains Tax to pay, you do not need to report the property disposal.
Thank you.

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