CGT implications from the sale of a house.

[Davidod1]

Hi Folks,

I will shortly have cash (€300,000+) from the sale of a house and I am wondering what will be the CGT implications.

A bit of background though. This house was in my name but my late mother was living in it on her own for the past 40 years. I am married and have recently had to retire from work due to the company's inability to continue to pay wages. My wife has recently also had to give up work for health reasons. Our only income is now my pension and my wifes supplementory payment - combined = €380 per week.

I have heard mention of a CGT allowance due to special circumstances such as leaving the property available for the use of an elderly parent. Anyone know anything about this?

Either way there will be cash to invest and I will also need to make it provide a supplement to my income.

Any information on the taxation situation would be very welcome.

Dave

 

[Gervan]

Yes, there is a dependant relative relief, which provides PPR relief for the period the property was occupied by your dependant relative. When I say "dependant" relative it doesn't mean she had no income, or that you were maintaining her. Your mother had to be incapacitated by old age or infirmity, or a widowed parent.
CGT relief applies for the period your mother occupied the property whilst qualifying as a dependant relative.

 

[Davidod1]

Many thanks for that: My father died in 1970 and she was living on her own in the house
right up Jan 2008. She died in Nov 2008 in a nursing home aged 97.

She had an annual income derived from a land letting and was not financially dependent on me. However from what you say it looks like it should be a fairly straight forward matter. If that is the case this would also mean I could deal directly with The Revenue Commissioners and without the need to get involved with financial consultants.

Dave

 

[Vanilla]

Many thanks for that: My father died in 1970 and she was living on her own in the house
right up Jan 2008. She died in Nov 2008 in a nursing home aged 97.

She had an annual income derived from a land letting and was not financially dependent on me. However from what you say it looks like it should be a fairly straight forward matter. If that is the case this would also mean I could deal directly with The Revenue Commissioners and without the need to get involved with financial consultants.

Dave

You may well be competent to submit a CGT return to the Revenue yourself, but I think this is a false economy.

I usually ask my clients to instruct their accountant and/or a tax adviser to do this for them. As far as I am aware accountants ( in my area) charge approximately 650 to 1000 plus VAT to do this ( could be less if straightforward). I think it is well worthwhile.