moneymatte­rs

The Daily Telegraph - Property - - Property Clinic -

Fol­low­ing a re­la­tion­ship of al­most 20 years where we both lived in our own houses, my part­ner and I got mar­ried in Fe­bru­ary. How­ever, we con­tinue to live in our own prop­er­ties and do not see this chang­ing in the fore­see­able fu­ture.

With re­gards to Cap­i­tal Gains Tax (CGT), one ex­pert has said that within three years we will have to nom­i­nate one of our prop­er­ties for CGT. Ex­pert No 2 says that as long as we are not liv­ing in the same house, nei­ther of us is sub­ject to CGT. We both own our own houses and have only our names on the deeds. Could you help clar­ify this? Mag­gie Flem­ing writes: I’m sorry to say that both your ex­perts are wrong, al­though ex­pert No 1 is al­most right! A mar­ried cou­ple can have only one prin­ci­pal private res­i­dence be­tween them. But you have only two years, not three, from the date of mar­riage in which to make a joint elec­tion for the one qual­i­fy­ing for the re­lief.

The main con­sid­er­a­tion in choos­ing which prop­erty is the one likely to pro­duce the greater gain on sale. Re­mem­ber that the fi­nal three years of own­er­ship of a house which has at any time been your only or main res­i­dence is al­ways tax-free, so, if it were likely that one would be sold within three years of mar­riage, you should nom­i­nate the other. Mag­gie Flem­ing is a di­rec­tor of Isis Fi­nan­cial Plan­ners and a mem­ber of the Char­tered In­sti­tute of Tax­a­tion.

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