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Where Taxpayers and Advisers Meet

Market value of part of house

hermit
Posts: 8
Joined: Wed Aug 06, 2008 3:02 pm

Postby hermit » Sat Aug 07, 2004 12:46 pm

My son owns 9/10th of a house bought for £85000 and now worth £150000. I own the other 1/10th as beneicial owner. It is let --not the residence of either of us. To make use of the annual exemption of £8200 he wishes to sell another part, say 20%,to me. We are of course "connected persons" and would have to use the market value. But what is the market value of 20% of a property. I gather it is less than the arithmetical fraction.
How can I find out how to value a share ?

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

Postby Ian McTernan CTA » Sun Aug 08, 2004 3:31 pm

Ask an estate agent for a valuation of the property and use the arithmetical fraction- this is not worth arguing over with the Revenue who will resist any argument to use less than the percentage sold. There was a recent court case on valuations such as these but for the amounts involved here it is not worth arguing the toss.

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

hermit
Posts: 8
Joined: Wed Aug 06, 2008 3:02 pm

Postby hermit » Tue Aug 10, 2004 3:57 am

Thanks for your comment. I would in fact prefer to use an arithmetical fraction, which would be covered , in my son's case, by the annual exemption and would give me a higher figure for my own cost of the part transferred than using a smaller value, but I thought the Revenue might contend for the lower figure -- which would give me a lower cost which I would have to use in any future possible sale of the whole.
Can you tell me the name/date of the court case you mention. Tax case ? Valuation case ?


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