Capital Gains Tax on rental property

B

Bgirl

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Quick history. My mother transferred a house she and my father owned for approx 10 years to me 3 years ago. When I took over the house it was valued at €127K and now its value is €165K. I have rented it since and have declared it for tax purposes. What are the tax implications if I now decide to sell it.
 
am I right in saying that I pay CGT on the difference between what it was transferred to me at and the price I get for it.
 
AFAIK you are correct. You also get CGT allowance. Just curious, is this house in Ireland at 165k?
 
It might be of interest to note that if you sell the house at a 165k (to a friend let's say) and the market value of the house is more, then you'll be charged CGT on the current market value.
 
Normally the current market value is what the asset sells for. Unless it is sold at a discount to what it might normally go for. If this is the case then it may be necessary to obtain a few independent valuations for the purpose of establishing the fair market value for CGT calculation purposes. If Revenue decide that they don't like the look of the fair market value used then they could audit and challenge it.
 
In reality, a valuer asked to provide a valuation for Revenue is unlikely to value the property at anything other than market value. So one valuation will do.

Its also worth remembering that The Stamp Duty Section of Revenue see a lot of properties passing through. They have a fairly good eye for an undervalue.

mf
 
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