Capital Gains Tax on Property

Along with inheritance tax, capital gains tax is often referred to as a voluntary tax. With careful prior planning, it is often possible to reduce or totally avoid this tax cost. Depending upon your circumstances, we may be able to advise you in the following ways.

Reducing the amount of capital gains tax assessable

• Claiming all valid tax deductions:
  • Professional fees,
  • Enhancement expenditure,
  • Indexation Allowance,
• Claiming all eligible reliefs:
  • Taper Relief,
  • Retirement Relief,
  • Principal Private Residence Relief,
  • Lettings Relief,
  • Gift Relief,
  • Set-off against current year or brought forward losses.
• Reviewing whether any elections could benefit you, such as nominating your principal private residence, if you own and occupy more than one house,
• Advising you of any practical steps you should take. This is particuarly relevant for capital gains tax planning for a second residential property,
• Crystallising the paper loss on other investments. This may be possible by submitting a neglible value election rather than through an actual sale,
• Considering emmigrating overseas and becoming non-domiciled, for UK capital gains tax purposes,
• Maximising the use of your Annual Exemption,
• Examining whether trusts or pension funds could be used as a capital gains tax planning device,
• Considering changing the ownership of the asset, particularly if your spouse has unused annual exemptions or current year or brought forward capital losses,
• Restructuring the asset held. This can be particularly useful within areas of corporate finance, where equities can be exchanged for loan notes, which can be redeemed over a number of years, taking advantage of more than one year's worth of annual exemption.

Delaying when the capital gains tax is payable

• Influencing the timing of the sale, including considering whether the disposal can be spread over more than one tax year, to maximise available reliefs and exemptions,
• Delaying payment of tax on the assessable capital gain by reinvesting the proceeds and claiming:
  • Rollover relief,
  • Holdover relief,
  • Deferral Relief.

The most popular capital gains tax on property service we offer is calculating your current exposure to this tax, then discussing your options for restructuring your affairs to reduce this tax.

Agreeing your capital gains tax liability with the Inland Revenue is achieved by completing the capital gains supplementary pages of a normal personal tax return. Clients who are fearful that this gain may be investigated by the Inland Revenue may wish to consider taking out our fee protection insurance.

Seek our advice in structuring your financial affairs and rest assured that you will not be paying any more capital gains tax than you absolutely have to. In addition, we shall complete all of the necessary paperwork for you and communicate with the Inland Revenue, to agree the liability, on your behalf.

Practical Examples of our Capital Gains Tax on Property Expertise

Capital gains tax taper relief on let property. Advising on the tax treatment of selling off part of your garden as a building plot.

Sheltering appreciating assets within your own pension fund, to shelter them from CGT. Bed and Breakfasting shares sitting at a gain.