Do I Have To Pay Capital Gains Tax On A Inherited Property?

[benko1]

I have inherited 50% of a property. The whole property was valued at £80,000.00 in March 2012 and it is now being sold at £85,000.00. This means my share is £42,500.00.

I do not own another property (currently renting) and I work full time and earn £13,000.00 per annum.

Will I have to pay capital gains tax? If so how much?

Kind regards

[Graham-W]

As I understand it, you would only be liable to pay tax on the increase in value. ie. £2,500. There is an annual exemption amount of £10,600 so you will not be liable for CGT..

[ubasses]

Was the value of the property £80,000 at the date of death. If so your share of £40,000 has only increased by £2500 well within the Capital Gains limit.

[New Judge]

No, You only have a tax liability on the increase in value from when you inherited the property to when it is sold. There is an annual tax-free allowance of £10,600. Since your share of the increased value (£2,500) is below that sum no CG tax is payable.

[benko1]

Yes the property was valued at £80,000.00 at time of death. I would like to thank you all for your time and your answers, It is very much appreciated!

[ubasses]

you are welcome, glad to put your mind at rest