Hello again
I have a couple of of follow up questions with regard to the following link.
https://www.gov.uk/hmrc-internal-manual ... al/cg65271
It provides a calculation for CGT to be paid if you split your home into 2 flats and sell the first flat as:
Gain = (Value of both flats at point of sale) - (unconverted value of flats at point of sale) - (conversion costs)
CGT = (Flat sale price) * (Gain) / (Value of both flats at point of sale);
This makes sense to me., however it states:
When the flat retained as the only or main residence is finally sold a further computation will be required as part of any gain arising on that flat may also be attributable to the conversion.
But it doesn't state whether the figures would be adjusted to the new point of sale.
Therefore my questions:
1. Would the figures used to calculate the CGT be adjusted to the new point of sale of the second flat?... if not inflation would make the CGT spiral and it would be crazy not to sell both at the same time.
2. Who decides the hypothetical value of the unconverted flats?... as this figure greatly impacts the CGT.
Hope that makes sense, and thanks to any responders.
J