CGT

cooker3

My mother along with her sisters and brothers sold the house which they all owned this year. She hasn't lived there in years. Does she has to pay capital gains tax? She isn't working at moment and hasn't all year so if she does have to pay, what is the general process behind it. When does it have to be paid etc?

Oafley Jones

cooker3 wrote: »

My mother along with her sisters and brothers sold the house which they all owned this year. She hasn't lived there in years. Does she has to pay capital gains tax? She isn't working at moment and hasn't all year so if she does have to pay, what is the general process behind it. When does it have to be paid etc?

Only your principal private residence is exempt from CGT.
Initial cost will be indexed, this will be deducted from the sales price. First 1,270 by an individual are exempt in a tax year. Standard rate is 20pc. If the sale is between Jan & Sep 08, tax should be paid before 31 Oct 08.

Goodluck2me

Also note that penalties apply if it's paid late. It would be best to get a bit of concrete advice somewhere though before you go ahead and pay it, to make sure you have the correct amount paid. 20% will be substantial enough I'm sure.

Jivin Turkey

How long does your mother own it? When did she last live in it? If she has lived in it since she owned it the portion of the time lived in it is exempt from CGT under the PPR exemption.

Did she inherit it from her parents? If so and she has not lived in it since I don't think she can avail of this exemption.

cooker3

She hasn't lived there since 1970's or something. She inherited (I assume) when my grandmother died which was around 1991/1992
The sale went through around March/April.
So the process she has to fill in a tax return document by the start of November and pay the fees?
Also, where can I get official advice on it? I suck at this. Thanks for advice so far

Goodluck2me

The amount that it was worth in 1991 will be indexed i.e. increased by inflation to today's prices.
so if it was say Feb 1991 to today and the house was worth €80,000 in 1991, and was sold for €400,000.

Index for Feb 91 - 0.242
Price in 1991 was 80.000
indexed = 330,578.
Worth today 400,000

69,422 is the difference. 20% of that is 13,844.

You would have to pay €13,488.

PM me the exact figures and when it was inherited etc and ill do a more specific one Rob.

Oafley Jones

goodluck2me wrote: »

The amount that it was worth in 1991 will be indexed i.e. increased by inflation to today's prices.
so if it was say Feb 1991 to today and the house was worth €80,000 in 1991, and was sold for €400,000.

Index for Feb 91 - 0.242
Price in 1991 was 80.000
indexed = 330,578.
Worth today 400,000

69,422 is the difference. 20% of that is 13,844.

You would have to pay €13884.40.

PM me the exact figures and when it was inherited etc and ill do a more specific one Rob.

Also, you forgot the exemption.:D
Just noticed that indexation charts don't seem to be offered by revenue.ie. Which is a bit poor.

cooker3

Cheers Joe. I get the figures although probably be a few weeks. Bad time currently

Goodluck2me

Oafley Jones wrote: »

Also, you forgot the exemption.:D
Just noticed that indexation charts don't seem to be offered by revenue.ie. Which is a bit poor.

they do offer them, that's where I got them anyway. Can't remember the link. I realise there are certain exemptions allowed but I was simply giving a rough example. Single persons and retirement relief etc.

cooker3 wrote:

Cheers Joe. I get the figures although probably be a few weeks. Bad time currently

Get your skates on though as the 31st Sept isn't all that far away no need to be paying interest whihc works outat c15% a year, paid daily.

ircoha

cooker3 wrote: »

My mother along with her sisters and brothers sold the house which they all owned this year. She hasn't lived there in years. Does she has to pay capital gains tax? She isn't working at moment and hasn't all year so if she does have to pay, what is the general process behind it. When does it have to be paid etc?

coming late to this: if there are multiple owners then the gain is divided between them and as they all get the 1270 allowance ....