Buying agent commission - offset against CGT or income?

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    Buying agent commission - offset against CGT or income?

    Hi there everyone. New here and looking forward to some good chats.

    I've bought a couple of properties through Choices Acquisitions, an agency who negotiates discounts from developers and private sellers. The commissions are quite hefty, though I should be making enough in instant equity not for this to be a problem. My question is: what can I offset these commissions against? I would ideally like to offset against income so I can have the benefit now. However, it could be argued that the commission is part of the purchase price, and therefore only offsettable against CGT when I sell. I don't plan to sell so that wouldn't be much good to me.

    I have also paid them a signup fee (some of you must be thinking I am a complete mug, but hey). This I guess must be offsettable against income since the fee isn't associated with any particular property.



    Commission's deductable only against CGT I suspect Mark.

    Are you sure this firm are bona fide? What you describe sounds suspiciously like those 'property clubs' that held BTL seminars a few years ago.

    edit: What do you know, I was right:
    To save them chiming in, JPKeates, Theartfullodger, Boletus, Mindthegap, Macromia, Holy Cow & Ted.E.Bear think the opposite of me on almost every subject.


      I agree it takes balls and cold blood to put your trust in these kind of organizations and it's not for everyone.

      The only property I have exchanged on so far is a newbuild flat at the Panorama in Ashford which, even with their commission cost me about £100k, at least £15k cheaper than the off the street price, so I think in this case the fee is justified. Completion next year or I can sell it on before then and take the profit.

      I've paid out a larger commission for a big HMO in Headingley, and here I am slightly concerned whether I've done the right thing. If the figures are what they say they are I'll be getting a 12% yield for it, in which case it surely must be BMV. Will find out shortly.



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