Capital Gains Tax

[Christmas Tree 4841]

Right, basically the proforma is this:

 

Proceeds..............................X

Less costs of disposal...........(X)

Net proceeds........................X

Less allowable costs.............(X)

Gain....................................X

Losses to set off...................(X)

Gain....................................X

Annual exemption...............(10,100)

Chargeable gain...................X

CGT @ 18%.........................X

 

So, you take the proceeds and deduct the cost of disposal (solicitor's fees, estate agent fees and I'm assuming HIPS fees). That gives you your net proceeds. You then deduct allowable costs (the price you paid for the place, solicitor's fees incurred, surveyor costs etc, the value of any capital improvements). That gives you your gain. You then deduct any capital losses from the current year and past years (if you have any). That gives you you total gain. You then deduct your annual exemption (which is £10,100 assuming you've made no other capital gains during the year). And then you take 18% of that and that is what you owe HMRC.

 

You and your wife should do one of these each, ensuring that you divide the proceeds, costs etc by two. So if the house sells for 200k then your proceeds are 100k, if you bought the house for 100k then your allowable costs are 50k etc etc.

 

 

Excellent, thank you mucho gracias.

[Rob W 0]

make sure you TELL HMRC on each form that you have split the costs and give them each others tax reference number

[Christmas Tree 4841]

make sure you TELL HMRC on each form that you have split the costs and give them each others tax reference number

 

 

Will do.

 

I used TaxCalc last year which I found excellent (sorry accountants) and from memory it did mention about linking the tax references.