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Where Taxpayers and Advisers Meet

Selling property asset into trust -> when should the sale be declared (for tax purposes)?

johng
Posts:1
Joined:Wed Aug 06, 2008 3:03 pm

Postby johng » Fri Jun 06, 2003 8:31 am

The property is owned by a company.

If the company were to sell the property to an individual today, but do so by way of two trust deeds, one now for say 2/3rds of the value and another in two years time for the final 1/3rd(following which the property legal title will be transferred), when and how should the sale proceeds be declared for tax purposes by the company?

i.e. The company is paid 2/3rds of the value of the property now (and still retains 1/3rd ownership) and the transaction is not completed for another two years when the final 1/3rd payment is paid to the company. At that point the property is no longer owned by the company and the legal title is transferred over.

Ian McTernan CTA
Posts:1232
Joined:Wed Aug 06, 2008 3:02 pm
Location:Bedford
Contact:

Postby Ian McTernan CTA » Fri Jun 13, 2003 5:31 am

This depends to a large extent on the wording of the deeds. The first 2/3rds will be taxable when the first deed is signed and the final 1/3rd could be deemed taxable straight away or in two years time. Consult a solicitor to ensure the wording on the transfer deeds is correct.

Regards.

Ian McTernan CTA
McTernan Associates Ltd
ian@imcternan.com
McTernan Associates Ltd
Chartered Tax Advisers
Bedford
Email through link on website:
http://www.imcternan.com


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