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taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
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Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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My wife and I purchased a second property in our joint names

Resolved Question:

My wife and I purchased a second property in our joint names which we lived in part time but latterly let out. This was in addition to our main residence. We sold it after about 8 years of ownership and made about £40k profit in mid 2014. Do we each have the benefit of the annual CGT allowance of £11k or only one allowance between us?
Also, can we set legal acquisition costs of the purchase of the property off from the gain as an allowable expense?
Many thanks.
Submitted: 1 year ago.
Category: Tax
Expert:  taxadvisor.uk replied 1 year ago.
Thank you for your questionYou can set off against the gain- all legal costs and fees pertaining to buying and selling of the propertyYou would each benefit from annual gains allowance of £11k .I presume you have taken all reliefs into account- private residence relief for the period the property was your main residence- final 18 months of ownership relief whether you lived in it or not as it was your main residence at some point during your period of ownership- letting relief upto a maximum of £40k per owner More information on private residence relief can be found on hs283 herehttps://www.gov.uk/government/publications/private-residence-relief-hs283-self-assessment-helpsheet/hs283-private-residence-relief I hope this is helpful and answers your question.If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.
Customer: replied 1 year ago.
Thank you! This is very helpful. When completing my Tax Return I presume I should comment in the "comment box" that my wife should also get her relief. Should I show the whole gain in my return. What is the £40k letting relief? We made about £10k per annum when letting it and I have paid tax on the rental income. Thank you again.
Expert:  taxadvisor.uk replied 1 year ago.
Thank you for your reply.You should only declare your share of the gain in your tax return and your wife should declare her share in her tax return.This way you both would get the gains allowance.Letting relief is available you have sell a property that was your main residence at some point during period of ownership where you have claimed private residence relief and you also let it when you moved out to another property that then became your main residence. Look at example 8 on hs283 under letting relief. I hope this is helpful and answers your question.If there are no more issues, I will appreciate if you would kindly rate my service/accept the service I have provided before you leave the site, to ensure I get credited for it by JustAnswer
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Customer: replied 1 year ago.
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Expert:  taxadvisor.uk replied 1 year ago.
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