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TonyTax
TonyTax, Tax Consultant
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I am a joint executor with my sister of our mother's property.

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I am a joint executor with my sister of our mother's property. She died in 10/2007 when the probate value of the house was £455,000. The property was sold in 05/2014 for £600,000. We had significant costs in securing planning permission, surveys etc. prior to sale as well as the costs of the administration which were complex. How much of this cost can be claimed to offset CGT? What sort of costs are allowable as "incidental costs of acquistion" and distinguished from "improvement costs"
Submitted: 1 year ago.
Category: Tax
Expert:  TonyTax replied 1 year ago.
Hi.
Take a look here for information on expenditure and CGT and refer to it as you read my answer:
http://www.hmrc.gov.uk/manuals/cgmanual/cg15150+.htm
Expenditure incurred in securing planning permission including professional fees, survey fees etc will be deductible if the conditions set out in CG15180 are met.
Incidental costs of acquisition are covered in CG15250 and CG15260 here:
http://www.hmrc.gov.uk/manuals/cgmanual/CG15250.htm
http://www.hmrc.gov.uk/manuals/cgmanual/CG15260.htm
Enhancement expenditure in the case of a property can be the costs of getting planning permission and/or any expenditure incurred in improving the property and enhancing its value, a conservatory, an extension, a new roof, central heating which wasn't there before for example. See the notes starting at CG15180 here:
http://www.hmrc.gov.uk/manuals/cgmanual/CG15180.htm
The general costs of administering the estate are no tax adeductible. Only that part of any professional fees related ot the disposal of assets are deductible for CGT purposes. See page 5 here:
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/323671/hs282.pdf
I hope this helps but let me know if you have any further questions.
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