Originally posted by AlexE
To answer your questions,yes it was bought pre CGT and it was PPOR.
Now my next question is another senario:
What if the situation was between my wife and her brother?
Lets say that they arrived on the value of the house e.g 200k. Now if I come in to the party to bay the property off them, under my name but get a loan on both names my wifes and mine, would that be a good move or not? Will they have to pay any CGT after it sold?
Hi Alex
Your brother and you are deemed to have acquired one half each of the property at the date of your parent's death and at the market value at that date.
As I mentioned earlier, when your brother sells you his half, you are deemed to acquire that half at the market value at the time of the sale.
Again, you have two halves of one asset and with each having a different cost base.
As to the second scenario, if you buy a house from your wife and her brother, the title would be in your name. Therefore, the loan is taken out to buy that house regardless of whose name is put on the loan documentation. Providing the property is available for rent, the interest on that entire loan is tax deductable.
Alex, in both this scenario and the earlier one, you would be wise to pay a valuer to provide a written valuation to protect you against the tax office assessing you on a "different" market value.
Have fun and good luck
Dale