CGT on Rebuild

wygde4

I bought a house overseas as a second home a few years ago. I decided to get rid of it and rebuild a totally new one. Only thing left from the previous house was a small part of the deck.

Question is: Can I put the cost of the rebuild as part of the cost of the house for CGT purposes (as well as the original purchase price and associated purchase costs) when I come to sell?

Thanks for your help.

00ec25

please confirm what you mean by "got rid of"

do you mean you demolished and built a new building or do you mean you disposed of / sold the building?

I suspect you are thinking about the deemed disposal rules...
https://www.gov.uk/hmrc-internal-manuals/capital-gains-manual/cg15770

wygde4

Hi ooec25

Apologies for not being very clear. Let me relate the history and put figures in...

I am a UK resident.
Property is is New Zealand.
Property bought in New Zealand for 365k in 2007 as second/holiday home.
Deck built on property in 2008 for 15k.
Stayed there between 3 weeks and 3 months each year since then.
Decided to rebuild in 2018.
Existing property demolished.
New property built in 2019 for 375k including replacing a chunk of the deck though some of it remains from the 2008 addition.

So the question is if I sell at some time in the future for, say, 900k, how much is CGT payable on? Is it 900 (sale price)-365(purchase price)-15 (deck built)-375 (rebuild) = 145k?

Hope this is a bit clearer.