Tuesday, June 28, 2011

Is tax due on an inherited house?

Q My father died in November 2008 and my brother and I inherited his house. We have been very slow emptying and renovating it and I am only just getting round to filling in the AP1 and AS1 forms to re-register the property in our joint names. The Land Registry have told me there is no penalty for late notice of a change in the register, but they suggest I complete the forms as soon as possible to avoid the possibility of identity fraud.

My brother and I both own our own properties, neither of us want to live in my father's house and I estimate it will take us at least another 6-12 months to make the property saleable. Are there any tax implications of completing the re-registration of the property sooner rather than later? My brother and I are both over 60, unmarried and have no dependents. BF

A The re-registration of your father's property has no particular tax implications. When you and your brother eventually sell, when calculating the capital gains tax bill the date you acquired the property will be taken as the date of your father's death, not the date you re-registered it. So you will need to know how much the house was worth at that date, which presumably you do since you should have had a valuation done when filling in the inheritance tax form for probate to be granted.


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Source: http://www.guardian.co.uk/money/2011/jun/22/tax-reregistering-inherited-house

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