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Sam
Sam, Accountant
Category: Tax
Satisfied Customers: 13917
Experience:  26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
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I sent a question about the sale of a barn/steading in Aberdeenshire

Resolved Question:

I sent a question about the sale of a barn/steading in Aberdeenshire a few minutes age .... to Sam and accompanied with my Mastercard details. By mistake and stupidly I pressed the delete button before completing my request !!I'm wondering if Sam is still there !!!
William *****@******.***
Submitted: 2 years ago.
Category: Tax
Expert:  Sam replied 2 years ago.
William
I am still here but your question does not seem to have appeared yet, could you advise what the question was
Thanks
Sam
Customer: replied 2 years ago.

Sorry about my inefficiency ! My question is : My wife died in 2004, leaving me her quarter share in farmland with an old steading/barn. Her share was valued at£28000., the other shares being held by her brother and sister. Later we decided to sell the steading as a private house but before selling it we were involved in expenses -water supply, access road,, legal fees, planning permission etc - amounting to £100000 ,my quarter share of costs being £25000.

The property has now been sold... and my quarter share of the purchase price after expenses is £48000.

I have spoken informally to my accountant but would value your independent opinion regarding Capital Gains Tax payable by me. Thank you help.

Expert:  Sam replied 2 years ago.

Thanks response and the additional information.
Yes you will have a capital gains as there has been a disposal of this asset, which has never been your main residence.
Can you clarify that
1) The 1/4 share value at the time you inherited was £28000
2) The quarter value share of the expenses were £25000
3) the sale value after selling costs (so not including the expenses at 2) or the value price at 1) were £48,000
So we have sale price less costs £48,000
Less inherited value and costs to better sale position £53,000
So loss of £5000?
If this is the case and you have made a loss of £5000 you still need to inform HMRC of this loss, which you can use against any future gains you may make.
if you had £48,000 left over after all the costs and value at the time of Inheritance, then there will be a charge of capital gains, with the first £11,000 exempt as this is your annual exemption allowance and the remaining £37,000 liable to 18% or 28% or a mix of both - this will be determine by your usual annual income - and what basic rate band there remains unused.
So if your annual income is in excess of £41865 - then the gain will be charged at 28% , if you annual income was £30,000 then the first £11,865 at 18% and ay remaining gain at 28%.
let me know if you require any clarification on the above, but it would be appreciated, if in the meantime you could rate the level of service I have provided (or click accept)
Thanks
Sam
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