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Where Taxpayers and Advisers Meet

CGT on portion of PPR used as an office

J H
Posts: 22
Joined: Wed Aug 06, 2008 4:02 pm

Postby J H » Fri Nov 30, 2007 5:48 am

I claim an amount of use of home as office. This is based on my annual cost of mortgage interest, rates and utilities. I have 4 bedrooms, use one as offfice so claim 25% of above cost. I kow my local tax office as happy with this in principle (though whether they agree with 25% dont yet know)

However what happens when i sell home and make, say, £100k profit, would they assess me on 25% of the profit? pro-rated for the period used as office

Peter D
Posts: 10668
Joined: Wed Aug 06, 2008 3:37 pm

Postby Peter D » Fri Nov 30, 2007 6:16 am

25% no way. What about all the other rooms. You're opening your self up to a CGT issue. HMRC District valuer will point you in the direction of the floor area of you 100% dedicated office in propertion to the remainder of the house. 25% they will fall about laughing. Yes your closing sentence may prove to be correct and espensive. Regards Peter

Pollard&Co
Posts: 70
Joined: Wed Aug 06, 2008 4:00 pm

Postby Pollard&Co » Fri Nov 30, 2007 6:26 am

I agree with Pete. CGT will apply

What amount does the 25% come to in your accounts?

view the following link from the HMRC on how you should apportion it.

http://www.hmrc.gov.uk/manuals/bimmanual/bim47825.htm

www.pollardandco.com Bradford Accountant

piazope
Posts: 186
Joined: Wed Aug 06, 2008 3:17 pm

Postby piazope » Fri Nov 30, 2007 6:27 am

Hello Peter,

I am considering having a 'wooden' purpose built office (approx £15-20k) in my garden, what would be HMRC views, Is this a capital item; I believe they depreciate in value over time?

Thank y0u.

Sincerely

Peter D
Posts: 10668
Joined: Wed Aug 06, 2008 3:37 pm

Postby Peter D » Fri Nov 30, 2007 6:50 am

I would suggest you will get a wider response if you post this in your own thread. Regards Peter

piazope
Posts: 186
Joined: Wed Aug 06, 2008 3:17 pm

Postby piazope » Fri Nov 30, 2007 8:27 am

Thank you Peter, I have done just that.

Sincerely,

piazope
Posts: 186
Joined: Wed Aug 06, 2008 3:17 pm

Postby piazope » Fri Nov 30, 2007 8:32 am

Going back to the initial question from JH:

One could always let out their property and rent another. obviously one would have to do the math, it worked well for a friend of mine.

Sincerely,

Peter D
Posts: 10668
Joined: Wed Aug 06, 2008 3:37 pm

Postby Peter D » Sun Dec 02, 2007 3:00 am

I really do not know what you are on about. ????? Regards Peter


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