Sale of a deceased's property: calculation of CGT

[The Leaper]

I’m looking for confirmation of my understanding as regards CGT on sale of a deceased’s property. Here’s the situation:

• I am one of two executors of the deceased’s Estate. The other executor is his daughter; I was a good friend.
• He died in August 2024
• He was a widower at the time of death
• His Will leaves everything to three residual beneficiaries
• He owned a property. The Will does not specify that the ownership should pass to any beneficiaries, so the executors are nearing the sale of this property, the proceeds of which will, of course, be added to other assets of the deceased and distributed to the three residual beneficiaries as per the Will.
• For probate purposes, the property has been valued at £525,000.
• The executors are selling the house for £545,000.

So, on a capital gain of £20,000 and with the CGT rate currently at 24%, I reckon that the executors will liable to pay £4800.There is a capital gains allowance of currently £3000 so, assuming the Estate has no other capital gains, the executors are due to pay £1800 to HMRC. We’re aware that we are due to pay any CGT to HMRC within 60 days of the sale of the property.

Is this all correct, please?

R

[LimmerickLad]

The Leaper said:

I m looking for confirmation of my understanding as regards CGT on sale of a deceased s property. Here s the situation:

I am one of two executors of the deceased s Estate. The other executor is his daughter; I was a good friend.
He died in August 2024
He was a widower at the time of death
His Will leaves everything to three residual beneficiaries
He owned a property. The Will does not specify that the ownership should pass to any beneficiaries, so the executors are nearing the sale of this property, the proceeds of which will, of course, be added to other assets of the deceased and distributed to the three residual beneficiaries as per the Will.
For probate purposes, the property has been valued at £525,000.
The executors are selling the house for £545,000.

So, on a capital gain of £20,000 and with the CGT rate currently at 24%, I reckon that the executors will liable to pay £4800.There is a capital gains allowance of currently £3000 so, assuming the Estate has no other capital gains, the executors are due to pay £1800 to HMRC. We re aware that we are due to pay any CGT to HMRC within 60 days of the sale of the property.

Is this all correct, please?

R

Can the beneficiaries not use appropriation and claim all 3 of their personal AEAs?



ETA I'm no expert but should the allowance not be taken off 1st then the balance x 24%?

Hope you don't mind but we are in the middle of doing exactly the same.

You can also deduct EA and solicitor selling costs as well as those incurred by PR's.

Edited by LimmerickLad on Thursday 11th September 13:47

[alscar]

I would concur with both your thinking and your numbers.
Obviously you’ve already factored in any IHT due if applicable which would be due at 40% in any case but in effect paying a lower rate for CGT on the difference is indeed how it works I believe.
Had the beneficiaries inherited the house instead and then sold subsequently I think the calculation would also be identical although at that stage they may have used up some or all of their CGT allowance separately.
Long winded yes imo to your question and not an expert.

[Mr-B]

Have a look at a deed of appropriation. It should allow the beneficiaries to use their individual allowances if they haven't already.