Is there a way to sell your UK home to family if you are living overseas?
If you have been living overseas for some time leaving members of your family to use your UK home in your absence, you may have reached a point where you are discussing selling your house to that relative.
The only question is if you were to sell your house to them, would you be liable for Capital Gains Tax (CGT)?
The answer is that if the sale goes through before April 6 2015, you will not be liable for CGT (assuming you haven’t been a UK resident for five years or more) but if you sell it after April 5th, there could well be tax implications.
New legislation is coming into force on the 5th April 2015 which will means tax will have to be paid on any rise in value between April 6 2015 and the date the sale of your property goes through.
However, you should also note that you are able to deduct any rise from your annual CGT exempt amount, currently £11,000, or, if the property is owned by you and your spouse, from your combined annual exemption.
Arguably any rise in value between 6th April 2015 and an imminent sale isn’t going to be huge but you will have to pay some tax not to mention cover the cost of the extra admin so, with that in mind, if it’s at all possible you should look to move before April 5th.
If you are resident overseas and are thinking about selling a property to someone inside or outside of your family, you need to make sure you understand all of the potential tax implications. If you have any questions relating to any aspect of your personal tax position please contact me on 01483 533119 or email firstname.lastname@example.org.