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Where Taxpayers and Advisers Meet

Land disposal of rented property

Robmeg
Posts:2
Joined:Wed Sep 02, 2020 1:07 pm
Land disposal of rented property

Postby Robmeg » Wed Sep 02, 2020 1:19 pm

Hi.

I am seeking advice on the disposal of part of the title of a property we currently let out, and any easy way to reduce CGT, including timings for sale of the 'mother house'. We have NOT resided in the property at all, and have let it out for 18 months since buying it. Its a 3 bed bungalow so not over 5000 sq feet.

We bought the property to gain planning for an additional dwelling, and have succeeded in that and are now selling the front garden at this point (£145k). We plan to sell the original (mother) house soon (after April 2021 if beneficial). The questions are:
1. As this will split the title, when do I need to declare to HMRC, as a may lose money on the main house when I come to sell so is it all 1 transaction?
2. Are there ways to minimse CGT (we will not move into the main house)
3. Are my costs deductible.
4. Any other useful information please.

Many thanks in advance

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

Re: Land disposal of rented property

Postby maths » Wed Sep 02, 2020 3:18 pm

Any profit on the sale of the front garden will be subject to income tax, not CGT. Similarly, as and when the rest of the property is sold.

Costs are deductible.

Robmeg
Posts:2
Joined:Wed Sep 02, 2020 1:07 pm

Re: Land disposal of rented property

Postby Robmeg » Thu Sep 03, 2020 3:13 pm

Thanks for the reply. One question from the original posts was: As this will split the title, when do I need to declare to HMRC, as a may lose money on the main house when I come to sell so is it all 1 transaction?

Kind regards

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

Re: Land disposal of rented property

Postby bd6759 » Sat Sep 05, 2020 9:00 am

You will need to complete annual tax returns for as long as you are carrying on this trade.


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