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Where Taxpayers and Advisers Meet

CGT on disposal of commercial lease

samlock
Posts:5
Joined:Fri Aug 09, 2019 8:51 am
CGT on disposal of commercial lease

Postby samlock » Tue Mar 16, 2021 3:58 pm

I require the calculation of Capital Gains Tax for the disposal of the beneficial interest of a commercial property lease I own ( a retail property with residential uppers).

The lease was included in the purchase of a business (going concern) I purchased about 35 years ago and only 5 years remain on the lease. I have sub-leased the property on FRI terms for an income of approx £35k per annum. I would like to to get an idea on the CGT I would need to pay.

.

AGoodman
Posts:1738
Joined:Fri May 16, 2014 3:47 pm

Re: CGT on disposal of commercial lease

Postby AGoodman » Tue Mar 16, 2021 5:30 pm

If you have sub-let for a rent then I don't see that you have disposed of any asset. You still have your lease and you are receiving the rent as a result of it. It's just like letting out a freehold property.

samlock
Posts:5
Joined:Fri Aug 09, 2019 8:51 am

Re: CGT on disposal of commercial lease

Postby samlock » Tue Mar 16, 2021 5:37 pm

I intend to gift the beneficial rights to income for the lease so it will count as a disposal for CGT I believe.

maths
Posts:8507
Joined:Wed Aug 06, 2008 3:25 pm

Re: CGT on disposal of commercial lease

Postby maths » Tue Mar 16, 2021 9:44 pm

There are both income tax and CGT implications on the grant of a short lease out of a short lease.

There is a part disposal.

bd6759
Posts:4262
Joined:Sat Feb 01, 2014 3:26 pm

Re: CGT on disposal of commercial lease

Postby bd6759 » Tue Mar 16, 2021 10:40 pm

Chapter 5A ITA 2007 (ss809AZA-809AZG). It's income tax you need to worry about. It's not easy to transfer income streams.


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