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Ask Your Own Question, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 5116
Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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I have a buy to let property which is in my sole name. I agreed

Customer Question

i have a buy to let property which is in my sole name. I agreed to give someone a profit share and need to pay £30k but am worried that this will affect my capital gains and that i will end up paying tax on this - is there any way around this?
Submitted: 1 year ago.
Category: Tax
Expert: replied 1 year ago.
Thank you for your question.Please clarify for me -when you had this agreement to share profit with someone, was it implied that the share was gross and would be subject to cgt deduction. Many thanks
Customer: replied 1 year ago.
No it was not. what they are saying is that they could give me an invoice and that they would then be responsible for their part of the tax burden (as i could then say that is part was not profit). Would this work and could i offset this against tax?
Expert: replied 1 year ago.
Thank you for your reply. Lets be practical.. The only way you would be able to offset an expense against this capital gain is if was associated with the sale of the property e.g selling agents fee, solicitor's charges. In my considered opinion, you should formalise the arrangement you had in the form of a deed of declaration and then declare your share of the profit in your tax return and the other person should declare his/her share of the profit i.e.£30k in his/her tax return. 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.
Expert: replied 1 year ago.
Hi there, just checking to see if I have addressed your points and/or you need further help/clarification. Many thanks