Selling @ a loss

Hello Everyone,

My wife and I are attempting to purchase a house from a relative - wife's sister to be precise. Without going down to deep into the story, she has a second home that she purchased in c. 2005 for c. 240,000. Today the valuation of the property is @ 140,000 and we are close to making a deal.

She has mention her fear of being caught with a massive tax bill, but what tax could she be liable for? She will be making a substantial loss.

Any insight from anyone would be useful.
To add a few details - she is a single mother, divorced, no income apart from maintenance.

Thanks

D

No CGT bill on sale but maybe she had it let out all this time and did not do a tax return ? She may be afraid the sale will get revenues attention and they start asking questions ?

Thanks Elcato.

She has been renting, but unaware of her dealings. Assuming its above board.

Has she paid the NPPR? That is a huge liability if it has not been discharged.

Also, LPT and the Household Charge.

mf

Just to follow on mf1's point, if she wants to sell she will have to discharge all of those three before she gets a clearance for sale of the property. If that is the case you could negotiate a price based on you discharging this for her in order to facilitate the sale.