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Capital gains tax - separation

  • 25-02-2023 9:50pm
    #1
    luckydingo
    Registered Users Posts: 12 ✭


    I have a question that I’m hoping someone might be able to help with.

    is there capital gains to paid on the sale of an apartment under the following circumstances.


    Apartment was the first property owned by married couple bought about 20 years ago. They then bought and moved to a house years later and rented the apartment out (reluctantly but was in negative equity)

    Couple then separated and divorce - wife stays in new home with children a husband moved back into apartment with new partner. Also has a new child with new partner)

    husband sells apartment and buys new family home with new partner.

    Is there capital gains on the sale of the apartment as it was not the “family home” or did it become the family home for the new family?


    thanks



Comments

  • #2
    ThreeGreens
    Registered Users Posts: 319 ✭✭ThreeGreens


    You need to time apportion the gain.


    So let's say it was owned for 20 years. It was used as principal private residence for 5 year, then rented out for for 10 years, then back into as home for 5 more years. Let's say there is a gain of €200K.


    You are exempt from CGT for (5+5) /20 *200K.

    That is you're exempt for the time that it was your family home and taxable for the time it was rented.

    That's assuming that apartment is now 100% husbands.



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