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TonyTax
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15950
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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I have sold a freehold of a house. How is capital gains tax

Customer Question

I have sold a freehold of a house. How is capital gains tax charged for this?
Submitted: 2 years ago.
Category: Tax
Expert:  TonyTax replied 2 years ago.
Hi. Did you sell the house with vacant possession, ie were there no tenants in the property when you sold it?
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Customer: replied 2 years ago.

I sold the FREEHOLD of a block of four flats not a lease. for £160000

Expert:  TonyTax replied 2 years ago.
Thanks.

Were there any active leases at the time of the disposal of the freehold? Who was the freehold sold to?
Customer: replied 2 years ago.

yes 4 leases including me and was sold to another lease holder (forced negotiated sale)

Expert:  TonyTax replied 2 years ago.

Thanks.

Leave this with me while I draft my answer. It will take a while so please bear with me.

Customer: replied 2 years ago.

Thanks for your attention. I'm looking forward to you answer.

Expert:  TonyTax replied 2 years ago.
If the property was owned at 31 March 1982, you can use the value at that time when calculating your gain. However, the value at that time will be reflective of the status of the property at the time, ie if there were active leases. In answer to your other question, a freehold is treated as land for CGT purposes.

Assuming you occupied your flat for the entire period of ownership of the lease, you will be entitled to relief from CGT for that part of the gain related to your flat. Take a look at HS283 for more information on main residence relief.

I hope this helps but let me know if you have any further questions.