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Demolishing property on plot of land
Myself, partner and family members, four in total are thinking of purchasing a bungalow which stands in half an acre. We would all like to build our own houses on the plot which will mean demolishing the bungalow. In effect we are buying the plot of land. We shall all live in the houses we have built. Does the fact that we are demolishing the existing property incur any cgt. We shall be splitting the half acre into 4 plots if we go ahead. Thanks for your help.
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Instinctive
- Posts:1797
- Joined:Wed Aug 06, 2008 3:15 pm
I am sure that I have seen this query in a different form.
Anyway, if you demolish a bungalow, it is not a disposal and there is no CGT implications. If you build houses for you all to use as only or main residences, there is no tax to pay because there is no sale of the new properties.
Ramnik
ramnikrp@hotmail.com
Anyway, if you demolish a bungalow, it is not a disposal and there is no CGT implications. If you build houses for you all to use as only or main residences, there is no tax to pay because there is no sale of the new properties.
Ramnik
ramnikrp@hotmail.com
Thank you for your very helpful response. You have seen this in a different form. As you can see, we can't make up our minds and at the moment we have all decided to build or build three for ourselves and sell one on which we realise cgt will be due. The two youngest member of the group will have to sell property to raise money to fund their build/s. Would they be able to live in the bungalow until it is demolished (whilst we are getting planning permission) or will this bring about further problems as regards tax.
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Instinctive
- Posts:1797
- Joined:Wed Aug 06, 2008 3:15 pm
taking account of the previous query and your latest comments, it is clear that you need professional advice because you are treading on dangerous grounds.
Ramnik
ramnikrp@hotmail.com
Ramnik
ramnikrp@hotmail.com
You have got me worried. Why is it dangerous please. We are each going to build our own house and live in them, possibly long term. This may leave one house or plot spare. However, some of us need accommodation whilst we are sorting out architects/planning. Would we be on dangerous ground if some of us live in the existing bungalow, which will eventually be demolished, say for a few months, until the site is cleared. I can't find my original question but we have changed our minds several times since them I think.
