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Where Taxpayers and Advisers Meet

CAPITAL GAINS

bikeabouter
Posts:4
Joined:Tue Feb 09, 2010 6:46 am
CAPITAL GAINS

Postby bikeabouter » Mon Feb 12, 2024 10:04 am

Hi all.
if there's a way through you can see through this, it'll be a great help!

There's a plot of land close which has planning permission for a 3 bedroom detached house on 3 levels in the town centre by the railway which I am pondering on buying.
However, I would like to change the house into 3 x I bedroom flats, as it offers me more flexibility for my situation, as I'm a bachelor and would like to rent out 2 of them and live in one myself, and then, if the time comes and I see another plot and need the cash to develop it, it gives me the option to sell one, two or all three.
The only problem with this however, is the CGT, for as far as I see, I only get relief on this monster tax on the one I declare as my principal private residence, not all three. So the way the tax structure is set up, it doesn't favour me or the town centre that needs small flats!

Is there any way through this or am I going to have to build a 3 bedroom detached house with lots of space which I don't need, so I dont get slammed!

Anyone see a way through this?

Thanx in advance!

bd6759
Posts:4239
Joined:Sat Feb 01, 2014 3:26 pm

Re: CAPITAL GAINS

Postby bd6759 » Mon Feb 12, 2024 10:00 pm

The tax structure is set up to tax income and gains. You only pay tax if you make a profit. Why do you think your money making venture should be exempt?

AGoodman
Posts:1723
Joined:Fri May 16, 2014 3:47 pm

Re: CAPITAL GAINS

Postby AGoodman » Wed Feb 14, 2024 5:18 pm

You're definitely paying some tax if you sell. You need advice on whether you can keep this to CGT at 28% or will have to pay income tax.


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