CGT tax or income tax on sale of property?

[nickabz@donco.fsnet.]

My wife and I own 5 buy to let properties in Aberdeen. In December 2003 we purchased a flat with the intention of letting it out. We spruced up the place a bit (carpets/decoration etc) but have been unable to find a tennant to date.

Fortunately, the property market in Aberdeen has gone a little daft in the last few months and we could probably sell the property and realise and £40-£45,000 profit. Will the revenue class this as being subject to CGT or will they assume that our intention was to trade in the property which I understand would then be subject to income tax?

Any help much appreciated.
Regards
Nick Garrett

[Ian McTernan CTA]

As long as you don't make a habit out of it, then should be CGT in this particular case, especially if you can prove the intention was to let it out (i.e. agency agreements, advert costs, etc.), and you already own and hold 5 other BTLs.

Ian McTernan CTA
McTernan Associates Ltd
Chartered Tax Advisers
ian@imcternan.com