Will I pay tax on the sale proceeds of my current house, which I have lived in since 1981 but was originally owned by my mother? My sister and I inherited it ten years ago when she died, and I have continued to live in it since. My sister and I are currently joint owners.

Arthur Weller replies:
The fact that you lived in the house before ten years ago is not relevant. Your ownership starts from ten years ago when you inherited from your mother. You should not pay any capital gains tax (CGT) now since you have lived in the house all the period of your ownership. If your sister has also lived in the house for the past ten years, she will also pay no CGT now, like you. But if she has not lived in the house, she will pay CGT now. Her base cost will be half the probate value of the house when it was inherited ten years ago.