Share this content
7

Capital gains when selling a rental property

Didn't find your answer?

I have someone with 3 rental properties who is now selling one of them.  

He is saying that he beleives capital expenses from ALL properties can be offset against the one being sold so utilising all the capital costs such as solicitor, stamp duty etc from all 3 properties now against the one being sold.  This sounds too good to be true, I would assume you can only offset costs incured against the specific property being sold rarther than them all?

Replies (7)

Please login or register to join the discussion.

avatar
By Wanderer
22nd Jul 2019 16:56

Ask the client why he believes that. Has a man down the pub told him that?

Thanks (0)
Replying to Wanderer:
avatar
By gainsborough
22nd Jul 2019 18:12

...and did he then misunderstand what that man told him because he was so inebriated himself?

CabrioChris, you are correct in your thinking and your client is not.

Thanks (0)
RLI
By lionofludesch
22nd Jul 2019 21:48

He is saying that he believes capital expenses from ALL properties can be offset against the one being sold so utilising all the capital costs such as solicitor, stamp duty etc from all 3 properties now against the one being sold.

He's been talking to the bloke down the pub.

I bet he believes nobody even landed on the moon.

And you're right - it's too good to be true.

Thanks (2)
avatar
By Jholm
23rd Jul 2019 16:10

...suppose you follow his route. What happens when he sells the other two? No doubt he will come up with some sort of capital cost at that point too?

Thanks (0)
Replying to Jholm:
RLI
By lionofludesch
23rd Jul 2019 16:29

Surely, he'll be able to use the loss created by including the costs of all three houses against the sale of the first.

Loses this year's annual exemption, though.

Thanks (1)
Psycho
By Wilson Philips
23rd Jul 2019 16:39

I wonder if the guy in the pub was thinking about section 244 of TCGA 1992? (I'm not saying that it would apply here, but it might at least explain where the nonsense originated.)

Thanks (0)
Share this content