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taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
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Experience:  FCCA - over 40 years experience as a qualified accountant (UK based Practitioner)
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My company bought an hotel from my brother I was previously

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My company bought an hotel from my brother I was previously renting the hotel from my brother. He sold it to me at a discount
JA: When was the property or asset sold?
Customer: Having now sold Sept 2019
JA: Anything else you want the Accountant to know before I connect you?
Customer: What figure should I use when working out the qain
Customer: replied 10 days ago.
Are you connecting me

Hello and welcome to JustAnswer. I am here to help you. I am reviewing your question and will respond to you shortly.
Many thanks

Thank you for your question.

As the sale is to a connected person albeit its your company that has bought the hotel, HMRC would substitute discounted sale price with the market value.

More information on this on HMRC internal manual CG14560

https://www.gov.uk/hmrc-internal-manuals/capital-gains-manual/cg14560

My aim is to give you aprofessional service. I hope this is helpful and answers your question.

If you need more assistance, please use the reply box below and let me know. It has been my pleasure to assist you with your question.

 

Customer: replied 9 days ago.
Is there a charge per question

Thank you for your reply.

You have paid for it when you asked the question.

I hope this is helpful.

Hi there

Just checking to see if you need more clarification/information or have I answered your question.

If there are no more issues, I will appreciate if you would kindly rate my service by selecting the 5 stars at the top of the screen before you leave, to ensure I get credited for it by Just Answer today.

Many thanks

taxadvisor.uk and other Tax Specialists are ready to help you
Customer: replied 9 days ago.
Not yet. My brother paid his capital gain using the discounted value this was back in 2011 would the revenue reopen his assessment on receipt of my computation later this year

I thank you for accepting my answer.

IT is difficult to say whether HMRC would reopen your brother's assessment going back to 2011.

Best wishes.

Customer: replied 9 days ago.
I know it is difficult that was why I asked the question
Am I obliged to use market value for my computation

Thank you for your reply.

You have to use the price paid as your company's accounts would show the amount paid as your cost.

I hope this is helpful.

Customer: replied 9 days ago.
Yet earlier it was stated that the revenue would substitute the market value ?

Thank you for your reply.

Your original question was "My company bought an hotel from my brother I was previously renting the hotel from my brother. He sold it to me at a discount".

Your brother should have used markey value when he sold the hotel to you back in 2011.

If you have now sold it in Sep 2019, your gain is based on difference between the price you paid and your sale proceeds.

Many thanks