CGT on sale of a property - before the sale closes

D

Darth Vader

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My sister has been told that the house she is selling cant close until the purchasers solicitor has received a CGT Clearance Certificate from her Solicitor. She dont understand what her CGT paymnets / liabilities have to do with the Purchaser and surely any CGT liabilities will be paid out of the sale proceeds so how can she apply for a CGT Clearance cert before the sale closes??
 
DV

Seems strange to me alright. I would have thought whatever your sister's tax obligations may be are between her and the revenue.

Is this her principal private residence i.e. her own home or an investment property she is selling? If it is her PPR then she is not liable for any CGT.

C
 
If the sale price is above a certain threshold, the vendors solicitor must produce a certain CGT form on closing or otherwise the purchasers solicitor is obliged to withhold 15% of the purchase monies on closing until the cert is furnished. The form is issued before payment of the relevant CGt by the tax office.
 
Are you sure its not a Property Tax clearance cert thats requested?
This works on a treashold of around 1.3M, and the retention I think is 15% of any EXCESS of 1.3M that the sale price reaches.
 
No, its not Property Tax its a Capital Gains Certificate. I finally managed to track down the relevant office in the Revenue and they explained that the Application form (CG50) is submitted to the Revenue before the sale closes, with a copy of the Contract for sale, and a Certificate is issued in about five days. No payment is due or requested at this point, it is pretty much a formality but it has to be done if the value of the property is over €500,000. Once the sale closes, the CGT is calculated and paid by the end of the tax year.

Thanks for your help everyone.
 
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