She was a care worker at the time so not sure if she was required to complete a self assessment tax return. Fitting a kitchen in the property or other improvements could reduce the possible £1500 tax owed down to nil
The optics of avoiding tax will be damaging but I’d hazard a guess there’s 400 similar tales if you do enough digging into the tax affairs of MPs. That doesn’t make anything right but if the story would have been buried for £1500 then why let it rumble if there’s any doubt with the advice given.
The CGT process gets triggered at completion. She’d have had 30 days to pay that (it used to be 60 so may well have been so at the time), but if she was self-employed/SA then she would’ve had until the following year to pay that way.
The big story though is not about the tax avoidance or her tax advice, it’s about any dishonesty and attempts at tax evasion. It’s a bit of an interest area of mine, and as I see it she’s ’played the game’ and I think there’s definitely something worth looking into (From the Tories perspective) and could be a game changer (reasons above).
Hers is a classic case. A couple meet, one (or both) have properties, they want to live together but know you can only have one principal address exposing the other property to CGT.
This is where it gets interesting. When she moved in with/married MR she didn’t sell or rent the property on the open market - she moved her brother in ‘rent free’. (There is some discussion to be had around tax needing to be paid on the ‘open market’ rate irrespective of what she actually receives (supposedly £zero.) Those doing the digging for the Tories will be all over that but we’ll park that as this is CGT for now).
She was 3 years into ownership when she moved in with MR. Her right-to-buy was heavily discounted and there would’ve been conditions around that:
Firstly, discount to be repaid if sold within x years (I think it’s generally around 5 years now (will council’s retaining first refusal buy-back for a further 10 years after that (at open market value (which they never do coz they’re skint))).
Secondly, there are rental restrictions too (normally no HMO’s)
As I see it it’s clear the big bucks were to be had by holding the property as long as necessary to draw out the discount and avoid repaying it which she has done. She’s been very cute for sure.
‘Some’ (an awful lot of) people put family members into such properties in this situation to bypass any conditions and manipulate the £zero rent/open market tax ramifications). I’m sure Angela would never do such a thing of course.
Then of course she’s playing everyone for a fool in saying “As with the majority of ordinary people who sell their own homes, I was not liable for capital gains tax because it was my home and the only one I owned.”
She married in 2010 so irrelevant that it was the only one she owned (see couples/principal address), and she’s desperately floundering when suggesting she was resident there after 2010 (avoiding CGT) when she was married, living at the other address and her brother had moved in.
In my view she’s lying on at least 2 fronts. She’s hiding behind a smoke screen of her being advised she paid the correct tax (based on false declarations or naivety, you decide) and it won’t wash.
The damage to Labour also lies in the (lack of) morality behind this - the ‘made-good working class hero’ who abused the system for her own gain.
No doubt may of us would’ve done the same, but for someone of her standing who lectures in morality it’s incredibly stupid to have left the back door wide open
Tricky times for her and Starmer and it’s not likely to get any easier.
