Whether you are wanting to avoid Capital Gains Tax on your property, there are a few legal tactics and loopholes you can look into. Or even at the very least you want to reduce your bill, then we have advice for yourself.
It is the tax when you sell something (for example a house) that has increased in value.
An example, say you bought something for £10,000. You, at a later date, sold this for £30,000. This mean you gained £20,000 (minus the starting £10,000 off the new £30,000).
You may be wondering, how do they calculate this? Well, you are taxed on the gain you have made, not the money that you have received.
Bare in mind, some of the assets you may have will be tax-free. The best place to check this would be on the Gov.UK website. You may not have to pay CGT if any or all your gains within a year are under your tax-free allowance.
Disposing is the most used word when it comes to getting rid of your assets. The term disposing includes:
There are certain times when you need to pay CGT. These are when you ‘dipose of’ or sell:
These assets are all known as ‘chargeable assets’. Depending on which asset, you may be able to reduce the amount of tax you have to pay and claim relief.
If you decide to dispose of an asset that you have joint ownership to, you will only have to pay CGT on your share of the gain.
The list above states when you will have to pay any CGT. If nothing on the list above applies to you, you will not have to pay CGT.
If you are donating your asset as a gift, then if this is going to a partner, wife, civil partner, husband or charity.
If unfortunately someone passes away, then CGT won’t be used, it will be inheritance tax due to you inheriting the asset.
I started writing for PPO back in August 2019. I particularly enjoy writing about new housing developments and upcoming property events.
Want to sell property portfolio in 2024? This is a massive decision that holds significant…
Getting started with Buy-to-Let (BtL) investing can be a thrilling journey towards financial growth, but…
The real estate markets of the United Kingdom and the United States are two dynamic…
Whether you own a business or private land, you will want to restrict who can…
According to the most recent annual report from student accommodation portal StuRents, the number of…
In the dynamic realm of rental properties, landlords and tenants are continually seeking innovative solutions…