There has been recent press speculation around Angela Rayner and her disposal of a property that, purportedly, gave rise to a capital gain of some £48,500 before costs of acquisition and disposal and her failure to pay any capital gains tax
We are not aware of the full circumstances by any means. We don’t know if there were any capital improvements to the property, such as building an extension or conservatory, both of which would reduce the gain.
We do not know also if there was an election made for this property to be their principal residence as opposed to any other property. She did live in it some of the time, and the last 18 months (at that time) of ownership was eligible for principal residence relief.
There is also the annual capital gains tax exemption, which was £11,000 at the time, and also helps reduce any chargeable gains.
Estimates of potential capital gains tax that may not have been paid vary between £3,500 and Nil.
This is not a political slant blaming her or condoning her.
Instead, we use this as an example to show how complicated the capital gains tax regulations are. It also highlights the importance of obtaining and retaining the necessary facts and figures before determining a capital gains tax position.
Please ensure you keep detailed records of costs of improvements, dates of living in and moving out of properties, any elections made, and completion statements on buying and selling and seek professional advice before contracts are signed.
Getting it wrong can be very costly!
Give us a call TODAY to find out if we can help you with your capital gains position.
