calital gains tax on buy to let property

bcool

Hi everyone and thanks in advance. my wife and i have a buy to let property (Jointly owned). Our tenants have expressed there wishes in purchasing our property. We bought for 77k and are going to sell for 112500 we also spent 13k renovating and professional fees. we have no capital gains from this year and don't intend on any capital gains next year. We have never used this property for private residence. we were wandering as the property is jointly owned can we both use our annual exemption allowance? Is there anyone on here able to work out if we will be paying cgt. if we need to post further info please let us know. thank you

AdrianC

How long since you bought it?

da_rule

This advice is based on you not owning the property until after the 31st March 1982.

£112500 (sale price) - £77000 (purchase price) = £35500 (net gain)
£33500 - £13000 (assuming all of the renovations are allowed as an exemption e.g. day to day running of a house is not allowable) = £20500 (you will also be able to deduct your costs involved in selling the property from this figure)
Assuming you and your wife own the property equally you will each therefore have a gain of £10250 (or less when you deduct sales costs) this is less than the CGT personal allowance of £10900 so as long you make no other capital gains in that tax year you won't have any CGT to pay.

bcool

hi Adrian, we purchased the property in December 2012

bcool

hi Da_rule thanks for your posting. my wife and I equally own the property, so if what your saying is credible then it would like you say mean that we wouldn't have to pay any capital gains tax

00ec25

bcool wrote: »

hi Da_rule thanks for your posting. my wife and I equally own the property, so if what your saying is credible then it would like you say mean that we wouldn't have to pay any capital gains tax

LOL. If you don't believe him then do your own reading
http://www.hmrc.gov.uk/cgt/intro/basics.htm

you have no CGT to pay given the figures you quote and the caveat regarding the £13,000

if neither of your already are required to complete a tax return then as you have no tax to pay you do not need to report the computation to HMRC
http://www.hmrc.gov.uk/cgt/intro/report-gain.htm

da_rule

bcool wrote: »

so if what your saying is credible

I won't take offence to that

bcool

sorry da_rule didn't mean for my comment to come across like that!

da_rule

Don't worry, none was taken. Was just pulling your leg.

bcool

hi 00ec25, thanks for your posting useful links