Abortive Sale

[umeshg1]

Can someone please assist with the abortive property sake scenario below

A was selling a development property for sale which fell through

There was a non refundable deposit of £10k. The solicitor fees was £15k on this transaction and client paid the £5k balance. The solicitor retained the £10k deposit towards their fees

Question- Is the £10k taxable and can we claim the £15k as a deductible expense for abortive sales

Thank you

[pawncob]

Yes the £10 is taxable. (with a deduction for fees paid)

[umeshg1]

Thank you for quick reply

In my case there is a £5k loss
Do I show £10k trading receipt and £15k under legal & professional fees or just show net £5k and describe in the profit and loss as loss on ' abortive sale'

Thanks

[bd6759]

Was this a trading transaction? By that, is a a proeprty developer who whould have paid income tax on the sale if it had gone through?

[umeshg1]

Sorry should have been more clear

This transaction was in a for a Property trading company

The property is still shown as stock in the accounts with cost of development to date

Thank you