My husband purchased our first home in 1976 for £8,500 (i.e. the deeds were in his sole name, as we did not marry until later that year), and we moved in as we purchased it. We moved out in 2010 (i.e. we lived in the property for 34 years) to our new home. We then let it out from November 2011 to November 2015. We transferred the deeds to my name in April 2012, as my husband is in a high-income tax bracket. We sold the property September 2016 (i.e. we owned it for 40 years) for £121,000, what is my capital gains tax likely to be?

Arthur Weller replies:
Your capital gain is going to be the difference between £121,000 and £8,500 = £112,500. You can deduct from this the capital gains tax (CGT) annual exemption of £11,100 (assuming you have not used it elsewhere), bringing your taxable gain to £101,400. When your husband transferred to you in April 12 it was on a 'no gain no loss' basis, so you took over his base cost of £8,500 from 1976. But your date of acquisition is April 12. Since you were not living in the house in April 12 when it was transferred, you do not take over his principal private residence (PPR) history, so you have no PPR relief or letting exemption (see www.gov.uk/hmrc-internalmanuals/capital-gains-manual/cg64950, CG64953 and CG64955). In retrospect, I would have said that the transfer in April 12 was not a good idea (i.e. because you now have a big CGT bill), unless the income tax saved in the past four years was at least about £28,000.