3 Comments Wills, probate, letters of administration, powers of attorney
There's no tax on anything when you receive cash or assets as inheritance, but once the property is in your possession, you'll be subject to CGT when you sell it (just like normal). If you and your brother share the property, then you will each have to pay half of the CGT when you sell it.
The executor will need to arrange valuation of the property before distribution of the estate and then provide the valuation notice (I forget the proper legal term for it but it's actually a document to be held for tax purposes) for future reference. This valuation (?) will be used for CGT calculation when the property is sold further down the track.
Recently my mother passed away and my sister and myself were the two equal beneficiaries. I bought out my sister's half share of the house that was part of the estate. The Public Trustee arranged the sales contract and also the valuation notice. The sales contract was for half the value of the house but the valuation notice was the full value of the house. I will use the valuation notice for CGT when I sell, not the purchase price, otherwise the increase in value (and subsequent tax) will be out of proportion with what it actually is. Hope I explained this okay.
Thanks for your response - Sorry I may not have been clear.
I wanted my wife to receive the investment properties and cash as she is the lower income earner so it saves on income tax and also helped reduce my taxable income etc for child support.
My question is mainly - can I transfer all to my wife's name from the estate without triggering CGT or any other gifting tax issue?
There will only be a capital gain event if the property was held for more than 2 years from death.
Inheritance does not form part of your income. I dont think there are any gift taxes to worry about. If you transfer property to her there will be transfer duties.
Basically you cant transfer it direct to her anyway as that does not conform to the instructions in the will.