CGT on business part of house property.

hoofy

I own and have lived in my house since 1986. At the back of the house there is a large garden and a workshop which I have have used to run a ltd company for the last 30 years. I have been told that if I were to now sell the property there would be cgt due on a percentage of the property that has been used for the business.

If I were to close my ltd company and stop trading altogether, turn the garden back into a regular garden and use the workshop for personal use only, would there still be cgt to pay if I stayed in the property for another few years and used it only as a domestic property?

The house and the workshop have separate bills from the council. The workshop is treated as a business but I get full relief on it so nothing to pay. I think I probably could get the workshop taken off the business rates register and put on to my personal council tax bill as it is only a building at the back of my house, not much different to having a big garage or a shed.

p00hsticks

I'm not an expert but I imagine that there would still be CGT to pay for the proportion of time that the workshop was used for the business, in the same way that you would potentially be liable for CGT for a period that a house was rented out even if you then moved back in.

sheramber

Who paid for the workshop?

Was it a business purchase claimed through the company or was it a personal purchase that was used for business purposes?

hoofy

It was a personal purchase.

I bought the property back in 1986 with a mortgage and only later did I start using the workshop and garden for business. I probably could/should have charged my business rent for use of my personal property, but I never thought of it at the time.

MyRealNameToo

Was it exclusively used for business? Didnt use it to store any personal items or do your hobbies in etc?

poseidon1

https://forums.moneysavingexpert.com/discussion/comment/81971908#Comment_81971908

Looks as if you may have a time apportioned gain for the period the workshop used exclusively for business.

HMRC's calculation tool below might assist in verifying your exposure, but you may well need professional assistance in calculating the quantum, relative to the value of the house itself -

https://www.gov.uk/tax-relief-selling-home