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Sam
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Category: Tax
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Experience:  26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
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My wife and sold a jointly owned field 19/05/13 for for £40,000.

Resolved Question:

My wife and sold a jointly owned field 19/05/13 for for £40,000. Am I right in thinking that the CGT allowance 2013-14 is £10,600 X 2 = £21,200 taxed at 18% so £1,692 payable to revenue?
Submitted: 3 years ago.
Category: Tax
Expert:  Sam replied 3 years ago.
Hi

Thanks for your question, I am Sam and I am one of the UK tax experts here on Just Answer.

The annual exemption rate for 2013/2014 is £10900 so in fact each of your gain is £40,000 less any cost to buy (so the purchase price and purchase fees such as legal costs) less also any costs to sell (so estate agent fees, legal fees)
Then what is left over is divided by 2 - to find each of your half shares, of which for each of you the first £10,900 is exempt and any remaining gain liable to capital gains tax.

The rate at which you pay capital gains is determined by how much basic rate band you have unused.
So, if you pay higher rate tax - then the remaining gain will be liable to 28% capital gain tax, but if your annual income is less than £42,475 - then you will have unused basic rate band - which will allow the equivalent of the gain at 18% and any remaining gain liable to 28% capital gains tax.

Do let me know if you have any follow up questions

Thanks

Sam

Customer: replied 3 years ago.

Thank you for your reply and I am very happy to pay you £28. I have no further questions so please do not put me on a retainer!!

Expert:  Sam replied 3 years ago.
Hi David

Thanks for your response and your feedback, 0 all you need to do is rate/accept the answer, and this will ensure I am credited for my time.

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Thanks again

Sam

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