Capital Gains Tax - Parents selling former home

S

SCA911

Registered User
Messages
111
Hi

My parents are looking into selling their former home and we are trying to decipher potential CGT. Details are:

House was PPR of mother from birth (1940's) and then both parents after marriage from late 1960's to 1980.
House was passed from grandparent to mother (grandparent died in early 1970's)
House was never sold/purchased outside of mothers family since being built approx 150 years ago, always passed down to family members through the years.
Parents moved to new house in 1980 and rented out original home since then, albeit under the radar.

We are wondering is the full gain liable to CGT, after any provable improvement costs, the €1270 exemption and costs associated with selling.

Any advice appreciated.
 
No. Your parents are entitled to the PPR relief for the period they were in occupation - I.e up to 1980.

I think ( but you would need to check) that CGT began in 1974. So it's the value in 1974 that any CGT will be based on.

If they occupied the house for, say 20 years, and have rented it out for 38 years your parents would be entitled to CGT relief of (20 + 1)/58.

I'd be a bit concerned at rent under the radar, there could be a significant income tax liability here.
 
Is there a paper trail of the rental income, ie, being paid into a bank or similar on a regular basis, or was it paid to them in cash? As Taxpert has said there could be a very big "OUCH" in this.
 
You must log in or register to reply here.
Back
Top