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Posted Sat, 27 Jan 2024 21:10:25 GMT by
Hi, hope you can help with my question. In November 1998 my wife and I purchased a home for £74700 which we lived in as our main residence until August 2005, at which point we decided to go our separate ways. It was decided that my wife would stay in the house we purchased and buy me out. She remortgaged for £135000 and transferred the property into her name only. This Provided me with an £80000 deposit to purchase my own property to live in. It soon became apparent that we had made a mistake so my wife move in with me and she rented out her property. If she decided to sell the property, my question is as far as Capital Gains goes, does she take the original purchase price of £74700 from the sale price and deduct Private Residence Relief for the time she lived there as her main residence. Or does she take the building society valuation price of £185000 in 2005 when the property was transferred into her name only from the sale price and not apply any Private Residence Relief?
Posted Wed, 31 Jan 2024 09:26:40 GMT by HMRC Admin 19
Hi,

Your wife will take her share of the purchase price in 1998 and then add the 50 percent valaution price in 2005. She can then claim any Private Residence Relief for the period she lived in the house, plus the final 9 months. You can see guidance here:

Private Residence Relief (Self Assessment helpsheet HS283)

Thank you.
Posted Wed, 31 Jan 2024 09:51:42 GMT by
Many Thanks Admin 19, Could I just check, does she claim the full amount of Private Residence Relief for the period she lived there from 1998-2005 or just 50% as it was in joint names for that period. Thanks in advance.
Posted Fri, 02 Feb 2024 09:16:41 GMT by HMRC Admin 2
Hi,

The Private Resident Relief applies to her part of the gain.

HS283 Private Residence Relief (2023)

Thank you.

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