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bigduckontax
bigduckontax, Accountant
Category: Tax
Satisfied Customers: 3823
Experience:  FCCA FCMA CGMA ACIS
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Good Afternoon. Buying property to renovate, let it and then

Customer Question

Good Afternoon. Buying property to renovate, let it and then sell it , would this attract same rate of CGT as BTL properties. I am a higher rate tax payer. Thank you

purchases will be in joint names me and my wife

Submitted: 1 year ago.
Category: Tax
Expert:  bigduckontax replied 1 year ago.
Hello, I am Keith, one of the experts on Just Answer, and pleased to be able to help you with your question. You will be liable to CGT on any gain made on the sale of this property. The gain is the difference between the net selling price ie less sales costs including advertising and the acquisition cost. The latter is what you paid for the house plus purchase coats including Stamp Duty Land tax or its equivalent in Scotland plus improvements eg installation of double glazing, central heating, extensions etc. This gain is taxed half each to you and your wife at 18% or 28% or a combination of the two rates depending on the individuals' income including the gain in the tax year of sale. You each have an Annual Exempt Amount (AEA), non cumulative,of, 11.1K to offset this gain. A word of warning though. HMRC may classify just one such transaction as dealing in landed property and tax the gain as income subject to Income Tax (IT). It has happened before. In this case there is no entitlement to the AEA. I do hope that you have found my reply of assistance.
bigduckontax and 2 other Tax Specialists are ready to help you
Expert:  bigduckontax replied 1 year ago.
Thank you for your support. If HMRC do go down the trading route I think that you will need to employ a trusted, local professional to fight your corner.
Customer: replied 1 year ago.

Thank you.

Expert:  bigduckontax replied 1 year ago.
Delighted to have been of assistance.

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