One extreme to the other

Dont_give_up

Hi All,

While trying to sort out charges and loans that I have fallen foul of due to no work and PPI - I might actually be getting a windfall!!

A website that I built has been getting lots of interest and I'm negotiating with a US company for a buy out, now heres the rub 40% (CGT) or Capital gains Tax to you and I. We all get taxed too much while the super rich get off with everything and while I dont mind paying some tax I'd rather give to my extended family than to Gordon Brown!!!

I feel like I believe many others this is a wholly unjust tax and I'm hoping that someone on the forum can help me lessen the impact.

Any HELP appreciated.

Murdina

Well the obvious point is can you wait until after 5 April, when the rate drops to 18%? And are you running a business of building or using websites, which might have been around for more than a year, so you get 50% taper relief on a business asset.(75% after 2) Indeed thinking about it some more, is your business actually one of building websites (even a one off could be a trade) so you could arguably be due to pay income tax, not capital gains tax?
Finally if you do have no other income, CGT is currently at 20% on the basic rate band and you do get an annual exemption. Do you have a spouse? Could be an option to give them half before sale (but this can raise other issues).
If you are talking a really serious amount of money, might be worth spending some of it in advance on seeing an accountant or a solicitor - you may need other (legal) advice too on other issues not to do with tax.

Dont_give_up

Murdina wrote: »

Well the obvious point is can you wait until after 5 April, when the rate drops to 18%? And are you running a business of building or using websites, which might have been around for more than a year, so you get 50% taper relief on a business asset.(75% after 2) Indeed thinking about it some more, is your business actually one of building websites (even a one off could be a trade) so you could arguably be due to pay income tax, not capital gains tax?
Finally if you do have no other income, CGT is currently at 20% on the basic rate band and you do get an annual exemption. Do you have a spouse? Could be an option to give them half before sale (but this can raise other issues).
If you are talking a really serious amount of money, might be worth spending some of it in advance on seeing an accountant or a solicitor - you may need other (legal) advice too on other issues not to do with tax.

Murdina thanks for this but I cat wait till May, this really is a deal for NOW!

Its a one-of situation where I've gone from debt collectors to potentially wealthy and the sum is significant. I bought a name in September 2006 and knew what I wanted to do with it. So I went to work on building the site on my local server, the situation with these types of site is it takes around 6 months before you can actually show online and thats what happened.

I am now in the ridiculous situation where I'm being pushed by 2 companies who realise the value now, and what it couls potentially be in a year or two and they want the site - NOW and by now I'm talking in the next 2 weeks.

But as I say this is one-of for me and I would rather give money to my mum than the Gov!!!!!

Murdina

It sounds to me that the money you might make could be income, not CGT. You bought an asset, you did work to make it more valuable and you knew that you could sell it at a profit. That's trading, not CGT. If you are really going to make a lot of money, I would be a bit nervous of you doing this kind of deal without involving some sort of professional - either accountant or solicitor - and they might comment further on tax as well as other aspects.