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Capital Gains tax on 50% sale of buy to let

How is CGT calciulated on a 50% sale?

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I purchased a buy-to-let house in joint names for £82k some 9 years ago.
It is now worth £130k.
Gain is £48k, so £24k each.

I am considering putting it in to a limited company.
How is CGT calculated on a partial sale.

E.g. if I sold a 50% share to my company is the CGT £24K and £12K, would each be exempt?

Could I sell the remaining 50% the next year and avoid CGT altogether, asuuming it was still worth £130K?

Is there a way of mitigating CGT?

Replies (12)

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By GW
13th Aug 2019 00:11

Given the potential amount of tax and the number of issues raised, including the disadvantages of putting buy to let property into a company, you need paid for advice rather than using a public forum.

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By Tim Vane
13th Aug 2019 01:11

LOL. Did Dave down the pub come up with this one? That guy is always so inventive and clueless. Nice one Dave, but do please read the relevant case law on attempting to exploit the annual exemption by splitting the disposal of an asset.

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Replying to Tim Vane:
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By Trannysister
13th Aug 2019 11:52

No, I had nothing to do with this one. Stayed in last night.
Davina (not Dave)

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By unearned luck
13th Aug 2019 01:13

“I am considering putting it in to a limited company.”
Why? Because you think that it will save tax or for some other reason?
If the former and if you are correct in thinking that then I suggest that the set-up costs and the running costs will outweigh any tax saving, especially if the property is mortgaged.
If the law is changed so that it becomes onerous to own residential property via a company, how will you painlessly extract the property from the company?

“Is there a way of mitigating CGT?”
Yes: sit on your hands. Leave it to your heirs in your will.

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By Tax Dragon
13th Aug 2019 06:28

The answer is yes but there is a range of other matters which you should consider.

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By Accountant A
13th Aug 2019 11:45

So 4 questions but the word "please" doesn't feature.

There seems to be a correlation between freeloading and lack of basic manners.

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Replying to Accountant A:
Hallerud at Easter
By DJKL
13th Aug 2019 11:57

Maybe there is also a hint of regress(ion) .

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Replying to DJKL:
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By Accountant A
13th Aug 2019 12:20

DJKL wrote:

Maybe there is also a hint of regress(ion) .

I have applied the Breusch–Pagan test to test for heteroskedasticity.

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By ireallyshouldknowthisbut
13th Aug 2019 12:13

I love this question.

For the fact that the main tax reason why you might consider this automatically prevents it happening.

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Replying to ireallyshouldknowthisbut:
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By Tax Dragon
13th Aug 2019 12:34

Well, potentially Cleary could intervene.

Sorry if that makes the question less loveable for you.

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Replying to Tax Dragon:
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By Accountant A
13th Aug 2019 12:43

Tax Dragon wrote:

Well, potentially Cleary could intervene.

I can see Cleary now ...

the rain has gone.

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Replying to Accountant A:
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By Tax Dragon
13th Aug 2019 13:41

The rain might instead have come (and landed on my parade).

Firstly, the code has been rewritten since Cleary.
Secondly, HMRC reputedly interprets the list below "and includes in particular" in s684(2) as an exhaustive list - even though that's plainly not correct.

Maybe ire ally can fall back in love with the question.

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