Thanks for your response
The capital gain position is as follows
If sold for £150K then the £60 can be deducted as this is the value when the house was inherited - this leaves an initial gain of £90K
From this £90K you can deduct the capital costs - and you advise this to be ££70K - so this leaves £20K
From this £20K you can also claim the costs to sell, so legal and estate agent fees - which I estimate will cost you approx. £2000 - so this leaves £18,000 to consider.
Then you also have the first £10,600 as exempt, as this is the annual exemption allowance for capital gains, so this leaves just £7400 to consider.
As your annual income is £40,000 - then you have £2,475 unused basic rate band which will allow the first £2,475 of the gain to be charged at 18% = £445.50 and then the remaining gain £4925 liable to 28% capital gins = £1379
So your total capital gains bill will amount to £1824.45
You should advise HMRC when this property is sold, so they can arrange to issue you with the appropriate self assessment tax return on which you must declare all income, including this capital gain. Any tax due is then payable no later than the following 31st Jan
So for example of you sell before 05/04/2014, then you will complete a 2014 tax return and pay any tax owed no later than 31/01/2015.
Do feel free to ask any follow up questions