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TonyTax
TonyTax, Tax Consultant
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My husband has a farm and had to sell a plot of land for

Customer Question

My husband has a farm and had to sell a plot of land for 200.000 to pay solicitor costs .. making a gain of 50.000 .. Because there is 100 percent tax relief on farming land (also his late father worked on it till he died ) what tax would we have to pay (capital tax)
Submitted: 1 month ago.
Category: Tax
Expert:  TonyTax replied 1 month ago.

Hi. My name is*****'m looking at your question now and will post my answer or ask for more information here in a short while.

Expert:  TonyTax replied 1 month ago.

Assuming your husband runs the farm as a business, is or was the plot of land he needs to sell used in the business on a day to day basis?

Customer: replied 1 month ago.
His father died 2 years and hadn't left a will so the administrator was dealing with it ..so we had to prove my husband was the son .through DNA ... long process 2years with solicitor...
Customer: replied 1 month ago.
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Expert:  TonyTax replied 1 month ago.

I can answer this without a phone call which costs extra. Which would you prefer?

Customer: replied 1 month ago.
Please answer without a phone call ..Thank you..
Expert:  TonyTax replied 1 month ago.

I'm assuming your husband runs the farm as a sole trader. He would have inhetrited the land at its market value when his father died and that will be the cost for CGT purposes.

You husband may qualify for entrepreneurs relief which you can read about here. If he does, he will pay CGT at 10% on £38,900 if the land is sold in 2016/17. The first £11,100 of the gain will be tax free due to the annual CGT exemption. You might refer to the articles here and here which may help in determining the possibility of qualifying for entrepreneurs' relief. If he doesn't qualify for entrepreneurs' relief, then he will pay CGT at 10%, 20% or a combination of the two depending on the level of his income in the tax year the gain is made.

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

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