Capital Gains Tax (CGT)
UK resident taxpayers have long had to consider whether they have a CGT liability (or a corporation tax liability on capital gains) when they realise a profit on the disposal of residential property in the UK.
Since 6 April 2013 the scope of CGT has been extended to include non UK resident taxpayers. Initially only companies and certain other vehicles were subject to this tax and only with respect to gains on higher value residential properties typically used by someone connected with them as their home.
However from 6 April 2015 the scope of CGT was extended to include disposals of residential property located in the UK to further classes of non-UK residents, including individuals disposing of UK residential property, regardless of their value or usage.
As RICS registered valuers we provide valuations for Capital Gains Tax and have experience in negotiating as necessary with HM Revenue & Customs.
Inheritance tax (IHT)
Inheritance tax (IHT) is a tax on money or possessions you leave behind when you die, and on some gifts you make during your lifetime. However, a certain amount can be passed on tax-free; this tax-free allowance is officially called the ‘nil-rate band’. Everyone in the 2016-17 tax year has a tax-free inheritance tax allowance of £325,000.
Due to rising house prices, many more families have become liable for inheritance tax; as a result in the Summer Budget 2015, the Chancellor brought in a new transferable main residence allowance, which will gradually increase from £100,000 in April 2017 to £175,000 per person by 2020/21. However the main residence allowance is progressively withdrawn once a couple’s estate (including the family home) tops £2m. Where a joint estate is worth £2.7m there will be no extra allowance, so the estate is taxed on everything over £650,000.
In order to clarify your own or families potential liability you should seek the advice of a qualified tax adviser.
As RICS registered valuers we provide valuations for Inheitance Tax and have experience in negotiating as necessary with HM Revenue & Customs.