My mother died in June 2016, and left her house to my sister and myself. I live in rented accommodation and my sister owns a house. The idea was that my sister would get a mortgage to buy me out. The property is worth about £205,000 to £210,000 so she would look to borrow about £105,000. Would my sister have to pay capital gains tax (CGT), and would they take the value of her property into account?

Arthur Weller replies:
What is happening is that you are selling your half of the property to your sister. Your base cost is the value in June 2016 when your mother died - the probate value. If it is worth more today than in June 2016 it is you who is making the capital gain (not your sister). However, it is unlikely that your half is now worth £11,100 more than in June 2016. If so, this capital gain is covered by your CGT annual exemption (if not used elsewhere), and you should have no CGT to pay.