CGT on building plot sale

[phil morris]

I am in the process of selling a parcel of land for which i have detailed planning for six properties .
The initial cost of this to me 2 years ago was £47,000 plus clearence costs of around £3,000 .

I am in the process of selling for about £180,000 and would like to know the ammount of tax if any i have to pay .
I bought the land in 3 parcels which are all now joined together as one , first parcel was for 12k the second for 12 and 25k for the third , i am not a developer , but have a mobile car repair business that makes about 15k a year.

I bought the land with a little bit of foresight and obtained planning to make it more valuable , is it better if there is CGT to pay to purchase something else ?
Thanks
Phil

[Simon Sweetman]

In fact, given the way you have organised this, since you have put the land together and obtained detailed planning permission, you may have to pay income tax rather than CGT if the Revenue can argue that this is an "adventure in the nature of trade".

The only difference here would be whether you got the annual CGT exemption. Apart from that you will pay tax at basic rate up to the limit and then pay at 40%.

simon.sweetman@btinternet.com