MegaSack DRAW - This year's winner is user - rgwb
We will be in touch
OK, so a few years back the ex Mrs and myself bought a house together. We bought it off her parents and they sold us it cheap on the proviso that we would give them £16k back when we sold it on.
A year ago we got divorced. Written into the divorce was that we would give her folks this £16k back. Fine, I'm an honourable sort of guy. Now we're trying to sell the house but by the time we've sold it and paid off the mortgage, the estate agent fees and paid her folks back the £16k there's gonna be nothing left.
A bit gutted, but I just want shot of it now, it's such a pain in the arse.
My question is: If we sell this and pay off the mortgage, will the tax man see the £16k we're paying them as profit and expect me to pay the tax on it? At the end of the day I haven't made any profit...
Any advice would be greatly received as I can't afford to have a £2k tax bill at the moment.
Thanks
no - you are effectively repaying a £16K loan, and besides as long as you've lived in the house as your primary residence there's no capital gains tax liability.
That's OK then. I have owned another property as well (just my name on the mortgage) since July last year and that's where I've lived since then. Would that affect it?
If the tax man knocks on your door, just quote him some of the guff MP's have been spouting recently.
On a serious note I think Farmer John has it right and you should be fine.
Thanks for your advice. Just need to sell the bloody house now...
of course the inlaws have made £16K on it...