Inheriting a property may sound like a dream come true, but if you don't handle your affairs correctly you could face a sizable capital gains tax bill further down the track.
While you won't need to pay CGT at the time you inherit the property from a deceased estate, there's certainly a possibility you'll trigger a liability when you sell it.
In a worst-case scenario, you inherit a home that had always been used as an investment property and you continue to use it that way. You sell it seven years after it passed to you and in that time the value of the property has increased by $700,000, representing a capital gain. Because you've ownedbut it still means that $350,000 will be added to your taxable income in the year you sell.
