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TonyTax
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15917
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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I own 2 and half acres of field that I live on in a static

Customer Question

I own 2 and half acres of field that I live on in a static caravan. I have right of occupation and pay rates and have my own post code. If I sell the land do I have to pay capital gains tax?
Submitted: 1 year ago.
Category: Tax
Expert:  TonyTax replied 1 year ago.
Hi. Take a look at HS283 for information on the main residence and CGT. As a home owner and assuming you don't use the field for business purposes, you are allowed to sell a plot up to half a hectare or 1.23 acres in size free of CGT assuming that the property has been your main home since you acquired it and that none of the land is sectioned off from the property and that you are unable to claim that you need a plot in excess of 1.23 acres for the reasonable enjoyment of the property. It would appear, therefore, that you may have to pay CGT on that part of the gain related to about 1.27 acres so if you did sell, you would need to divide the gain in proportion to the tax free and the taxable parts. I hope this helps you but let me know if you have any further questions.
Customer: replied 1 year ago.
The field is used as a mini farm? we breed and sell pigs, have Alpacas that we sell the fleece, have checikens that we sell the eggs.
Expert:  TonyTax replied 1 year ago.
In that case, you may be able to claim entrepreneurs relief on the excess land which is being used as a business asset and pay CGT at 10% as opposed to 18% or 28% or a combination of the two. See page 6 of HS2383 here:
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/323679/hs283.pdf
You can read about entrepreneurs' relief in HS275 here:
https://www.gov.uk/government/publications/entrepreneurs-relief-hs275-self-assessment-helpsheet/hs275-entrepreneurs-relief-2015

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