P
Philip Herlihy
I hope folk don't mind me asking a "domestic" tax question - I can't find a
more suitable forum! This is a "round-numbers" hypothetical version of an
issue which affects someone I know.
Say this person inherits a house valued at 1,000,000. The IHT zero-rated
band is 325,000, so 675,000 is liable at 40%, giving a tax liability of
270,000. So they turn out their pockets, pay HMRC the 270,000 (deep
pockets!) and keep the house.
Some time later, they sell the house, and see a gain - say they sell it for
1,500,000. Obviously, there's a liability to Capital Gains Tax, but can she
argue that the value at acquisition was the original 1,000,000 plus the
270,000 IHT paid?
I think I can guess the answer to this question, but it would be good to
have an opinion from someone who knows about these things!
Phil, London
"Nothing is certain but Death and Taxes". (I prefer taxes...)
more suitable forum! This is a "round-numbers" hypothetical version of an
issue which affects someone I know.
Say this person inherits a house valued at 1,000,000. The IHT zero-rated
band is 325,000, so 675,000 is liable at 40%, giving a tax liability of
270,000. So they turn out their pockets, pay HMRC the 270,000 (deep
pockets!) and keep the house.
Some time later, they sell the house, and see a gain - say they sell it for
1,500,000. Obviously, there's a liability to Capital Gains Tax, but can she
argue that the value at acquisition was the original 1,000,000 plus the
270,000 IHT paid?
I think I can guess the answer to this question, but it would be good to
have an opinion from someone who knows about these things!
Phil, London
"Nothing is certain but Death and Taxes". (I prefer taxes...)