Rental or trading income / CGT or income tax?
My client has a large number of properties, all of which were refurbished and are now rented out.
Some are intended to always be rented out and are held in a 'Property Rental' partnership whilst others, which are intended to be sold at a gain, are held in a 'Property Development' partnership. As such, the expenditure incurred in the property development partnership on legal fees, mortgage interest etc are offset against trading income.
If the properties in the property development partnership are rented out prior to being sold, is it acceptable to treat this income as trading income and will the eventual gain/loss on the disposal still be a charge to income tax, rather than CGT?
Advice much appreciated, thanks in anticipation.
- Taxfiler - SA100 - More efficient? 691 5
- See you all on the other side 727 6
- 12Pay 493 2
- dividends 687 2
- R&D 344 1
- Quarterly Reporting - The Logistics 1,206 17
- Auto enrolment contribution rates 460 3
- How long are you waiting for appeal reply 451 4
- Borrowing money to loan to company 401 1
- Mother as Guarantor for Son's mortgage 562 5
- Seeking a tax case 670 9
- When do we qualify for state pension? 533 4
- Companies house strike off 611 3
- Tax treatment of alterations to property 457 2
- Moving to the cloud 765 9
- Iris open space/doc exchange for SATRs 224 2
- How much to charge for payroll? 927 16
- Unincorporated charity transfer to CIO 226 4
- BTC vs Digita 1,109 29
- Has anyone tried calling HMRC to get tax on dividends put in code? 517 4
- HMRC Joint Filing 570
- Capital Contribution towards a company car 424
- Capital Reduction & Impact on EIS Shares 378
- IRIS and FRS 102 360
- Capitalising Finance Lease 337
- National Minimum Wage issue on Directors joining a Workplace Pension 334
- Marginal rates of tax 324
- USA help 324
- Class 2 NI 310
- Dormant company accounts under FRS 102 302