Capital Gains Tax Let Property
March 24th, 2010
Question: Capital Gains Tax on property?
Hi, I’ve got a question regarding UK capital gains tax – I am the sole owner of a house, which is my current permanent residence. My mum and my grandmother also live at the property, and they pay a rent to cover 100% of the mortgage. The property is never in profit – their contribution covers the mortgage, and is declared on my tax return. My question is, in future, will there be a capital gains tax liability on the property when I come to sell it? I heard from a friend that the rules on renting to more than one ‘tenant’ become complicated with regards to capital gains tax, so any advice would be appreciated! Obviously, being family, we haven’t got any official contract drawn up between us. It’s an informal arrangement as such. What I’m also keen to find out is if the situation changes should I buy a second property for myself to live in (and declare as my permanent residence). If you require any other info to advise in this matter please let me know and I’ll add a further comment!
Answer: Family don’t count if they are living with you. It’s not rent they pay you it’s a contribution for utilities etc.
You may also be interested to know that you can have a lodger in your home and receive circa £4000(approx) rent which is allowed tax free, see the link below
Taxman using Land Registry to nail tax dodgers
Kevin Reed, Accountancy Age , Monday 22 March 2010 at 10:18:00 Buy-to-Let landlords and those selling a second property targeted by HMRC Land Registry details are being used by the taxman to track down tax dodgers. UHY Hacker Young has warned buy-to-let landlords and people selling off second properties that HM Revenue & Customs is using Land Registry details to match up against those failing to …
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Posted in Real Estate Capital Gains Taxes | 
Tags: capital_gains_tax, cgt, investment, property_let, tax