Capital Gains Tax - reassurance required!

rowets

Hi all, I've been asked a question by a client and I just wanted to be sure of my reply so was hoping for some reassurance from fellow members if poss.

Client was gifted his parents house several years ago, whilst his parents were alive and still living in the house. Sadly last year his father passed away, and his mother decided that she didn't want to live in the house alone so has now moved in with a friend. Client has now sold the house. When calculating the CGT liability, am I correct in thinking that the Cost of Aquisition will be the Market Value of the property at the time it was 'gifted', even though it was physically given to my client for nothing? All other aspects of the computation are clear, Incidental costs of Aquisition and Disposal, there are no improvement costs etc, it's just this one point regarding the Aquisition Cost that I need to be sure I'm clear about, anyone able to help me?

Thanks for listening,
Tim

peaman

Yes, I would agree with you, the cost should be the market value as at the date it was gifted.