Capital Gains Tax

fed_up_ex_civil_servant

Hi. Just a query please. Can you advise roughly what CGT would be payable on agricultural land. Purchased in 2010 for £95,000 and potentially sold Oct 2023 for £165,000. Is there any advantage in selling half/ half over 2 tax yrs?

Thanks

Jeremy535897

Assuming that this is land let out, the tax rate will be 10% to the extent that your income is less than the top of the basic rate of tax, and 20% thereafter. The capital gain will be £70,000 less costs of acquisition and costs of sale. If you have no other gains, you can also deduct your annual exemption of £6,000 for 2023/24. Splitting the sale across two tax years would give you an extra annual exemption of £3,000 for 2024/25, unless you make other gains. You might be able to transfer part or all of the land to a spouse/civil partner well before the sale to reduce the tax rate (depending on their income) and have an extra annual exemption, but you should take advice on how practical that would be, and it may not achieve anything if the sale is already effectively agreed.