CGT evidence

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

    CGT evidence

    Hi All,

    I’m an accidental landlord and about to sell the house. Lived in it for 4 years and rented it out for 6 (with the intention of moving back, which never happened)

    im aware I need to pay CGT and can claim improvement costs, I basically bought a wreck and renovated it and added an extension

    as I’m an accidental landlord I didn’t keep most of the receipts for the work I did apart from big ticket items like bifold doors and the shell costs for the extension. I’ve done a rough estimate and think I spent circa 40k on works I don’t still have the receipts for. I’m thinking of using average costs from a website for costs such as require etc. Does that sound like a practical way of working out my costs, and decent enough evidence for HMRC?

    any help / experience / guidance appreciated

    thanks

    #2
    Accidentally signed an AST?

    No receipts so what would you do if you need to get supplier/contractor back due to bad work? Was this cash in claw?

    Surely at least bank statements or credit card records of expenditure? Can you get confirmation from suppliers? They must have records
    I am legally unqualified: If you need to rely on advice check it with a suitable authority - eg a solicitor specialising in landlord/tenant law...

    Comment


      #3
      HMRC will require no evidence unless they decide to investigate in which case guesswork will be insufficient.

      Comment


        #4
        Did you really pay out £40K in cash to tradesmen who gave no receipts ?

        If you just claim the costs for which you have receipts, the capital gain achieved during the rental period = 50% of the total capital gain. What does this figure come to ? .

        Comment


          #5
          Since you live in the house for 4 years plus you can claim 9 months after moving out as your main residence period = roughly 5 years .

          You will have to pay cgt for last 5 years whilst under rental . I suggest you pay for a "high valuation" for your property in Aug 2015 from a local surveyor and use that value for calculating the capital gain..

          Comment


            #6
            Originally posted by PaulRs1
            “Accidental” meaning I didn’t buy the house intending on being a landlord, and on the receipts I kept them for a couple of years but for jobs like the houses being painted inside and out, landscaping plastering and the like I didn’t think of hanging onto receipts for that sort of thing, which I’m regretting now.
            Most of those things are not capital expenses anyway. Your probably already claimed then as expenses against rental income. Painting a place which you then live in certainly is not a capital expense, not an improvement (in CGT terms). Building a wall where there was not one before is an example of an improvement.

            Comment


              #7
              AndrewDod is right, the extension sounds like a capital item, but the refurbishment of the property itself probably isn't.
              And, for all the work done while you were living there, there's no tax allowance against income.
              When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
              Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

              Comment


                #8
                If you have not kept any records, it seems the tax officer will want you to recreate the figures (estimated that you want HMRC to accept)

                https://www.gov.uk/capital-gains-tax/records

                Comment


                  #9
                  Originally posted by Gordon999 View Post
                  I suggest you pay for a "high valuation" for your property in Aug 2015 from a local surveyor and use that value for calculating the capital gain..

                  Can you do this? What is the point? Isn't CGT calculated on a straight line?

                  Comment


                    #10
                    no CGT is not calculated in a straight line any more that prices go up in a straight line. However you can get indices from HMLR for your area and property type which are fairly accurate being averages of transactions registered

                    Comment


                      #11
                      Originally posted by Gordon999 View Post
                      You will have to pay cgt for last 5 years whilst under rental . I suggest you pay for a "high valuation" for your property in Aug 2015 from a local surveyor and use that value for calculating the capital gain..
                      a) The value in 2015 is totally irrelevant to the CGT calculation

                      b) If it were relevant, this would be fraud anyway

                      The only value that is relevant is that in 2010 and the value of the sale. Even if the price went down since 2015, but increased overall since purchase, CGT is payable. Don't waste your money on a surveyor, and attempting to induce them to collude with tax fraud won't help anyway.

                      Comment

                      Latest Activity

                      Collapse

                      • Reply to capital gains bill when due
                        by AndrewDod
                        Not completely following you artful. There is a PERFECTLY GOOD online form which actually works remarkably well running you through the process. I usually criticise shambolic administration - but in this instance it was fine/good.

                        Press big green start button on this page
                        https...
                        26-09-2020, 15:37 PM
                      • capital gains bill when due
                        by halfax
                        sold a property in august 2020, informed hmrc , anyone know when i will get thethe tax demand?...
                        12-09-2020, 18:51 PM
                      • Reply to capital gains bill when due
                        by theartfullodger
                        Had a look at a tax forum, this does seem to still be a requirement to report within 30 days but, like so much of Cummings' wonderful administration simply doesn't work & has no IT or paper form operational. Do hope someone can prove me wrong... see
                        https://www.taxationweb.co.uk/forum/......
                        26-09-2020, 15:20 PM
                      • Reply to Tax to Pay on Lease Extension
                        by flyingfreehold
                        it applies where someone could exercise their right to compulsorily acquire. we have only claimed the extra statutory concession where an extension is granted strictly clause 56 of the act but it may be allowable on a non statutory extension at a nominal ground rent....
                        25-09-2020, 20:24 PM
                      • Tax to Pay on Lease Extension
                        by divadee
                        Myself and partner own the freehold to the building we live in, this is in the form of a limited company. We were accidental freeholders as the previous freeholder wanted to sell and no one else living here wanted to buy it so we bought it to have some control over the service charges etc....
                        ...
                        07-08-2020, 09:48 AM
                      • Reply to Tax to Pay on Lease Extension
                        by Gordon999
                        You should look at the last set of company's accounts and check if the money to pay for purchase of the freehold is shown money as "borrowed from Director" . The situation may well be the company has made a loss £9K- £10K .and the funds held by the company can be paid back to Director to...
                        25-09-2020, 13:23 PM
                      • council tax liability
                        by dexterpierson
                        I had a tenant who moved out of my property without giving any notice and posted the keys through the estate agent's letterbox.
                        I notified the council of this and the date the keys were returned and resumed liability for the council tax while the property is empty.
                        The council got back in...
                        14-09-2019, 10:11 AM
                      • Reply to council tax liability
                        by dexterpierson
                        That is brilliant.
                        Thank you so much
                        25-09-2020, 11:21 AM
                      • Reply to Tax to Pay on Lease Extension
                        by Section20z
                        Does that only apply where they "could have" and did, or also if the non statutory option is followed ?...
                        25-09-2020, 08:14 AM
                      • Reply to Tax to Pay on Lease Extension
                        by theta
                        My understanding (with the caveat that I'm not an accountant) is that the proceeds are not income but partial disposal, therefore return of capital plus gains. Within a company there's no difference between CGT and income tax, but it does mean that you offset the original acquisition cost....
                        25-09-2020, 07:06 AM
                      Working...
                      X