My wife was left a parcel of 12 acres of agricultural land by her father. A national builder has an option on the land and hopes to get planning permission by this time next year. My wife stands to gain up to £12m from this sale. What would her CGT situation be?
On the face of it, in order to calculate the gain for tax purposes you start with the sale price less the inherited value (probate value). From this amount you then deduct any costs involved in selling the land and then deduct your wife's annual capital gains tax (CGT) allowance (the full allowance is £10,600 for 2012/13 tax year).
The remainder will be liable to capital gains tax assuming she just pockets the proceeds.
If your wife is a higher rate taxpayer (annual income in excess of £42,475) then the gain will be fully liable to CGT at a rate of 28%. If your wife's annual income is less than £42,475, then any unused basic rate band will allow that equivalent amount of gain to be charged at 18% and the the balance at 28%.
But given the size of the sums involved I suggest that you employ the services of an accountant to ensure that you pay the correct (and least amount) of tax possible.
I hope that helps