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Tony Tax
Tony Tax, Tax Consultant
Category: UK Tax
Satisfied Customers: 15933
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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My husband died in 2008. He had entered into an option agreement

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My husband died in 2008. He had entered into an option agreement with a builder to develop his business premises. After 5 planning applications, the builder is now in a position to purchase the freehold of the premises - will CGT or inheritance tax be payable. The proceeds will be split equally between myself and my 2 (adult) children.

Can you tell me happened to the business when your husband passed away? What tyope of business was it? Was the premises owned by your husband personally or through a limited company? Who now owns the business premises?
Customer: replied 3 years ago.

The car rental business was wound down slowly as my husband's cancer progressed, and ceased trading on his death. My husband owned the premises personally - they have been unoccupied for the past 5 years (in fact the roof partialy fell in due to water damage so the local council have ceased taking business rates as they deem the site unfit). The premises technically belong to the Executors (sadly I'm not one of them) but they have never been transferred out of my late husband,s name.


When your husband died, the business premises would have passed to his Executors who would be responsible for valuing his assets, settling any debts and paying any Inheritance Tax liability. The remainder of the estate would then have been distributed to the beneficiaries.

If the property is still held by the Executors and it is sold for more than its value when your husband died, then the gain will be subject to Capital Gains Tax at 28%. You could reduce the CGT by having the property put into your own and your children's names before the sale. That way, you will each be entitled to exemption for the first £10,900 of your respective shares of the gain and some CGT may be payable at 18% instead of 28% depending on your individual income levels.

I hope this helps but let me know if you have any further questions.

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