Deed of Appropriation and deduction of expenses for CGT purposes

[itm60]

I have a question regarding the treatment of expenses associated with the disposal of an inherited property.

Mrs M passed away in 2022, leaving her estate to her 2 children. Her children are also Executors, with only Child A being named on the Grant of Probate.

Mrs M's estate included a property which was valued for Probate at £411,000. Within 6 months the property sells for £450,000 - an uplift of £39,000 on the Probate valuaton.

In order to make use of their individual CGT allowances, Mrs M's children arrange for a solicitor to create a Deed of Appropriation, allocating the property to them prior to sale. There are some significant expenses incurred during the property sale - most notably solicitors' fees and house clearance fees. My question is: (how) can these expenses be used to reduce the CGT liability for Mrs M's children?

[dslippy]

Expenses incurred solely for the property and its pisposal should be deductible, but take advice direct.

[itm60]

Expenses incurred solely for the property and its pisposal should be deductible, but take advice direct.

How should the allowable expenses be declared - e.g. should they be deducted from the value of the property transferred to the beneficiaries, or should the expenses be declared by the beneficiaries?

[dslippy]

If the property is being sold by the executor, they his expenses.
Again, the solicitor who createdvthe deed of appropriation knows its terms and their effect. Ask

[Sam101]

Tax is applicable to net gain. The sale costs incurred are deducted from the gross gain.