Long lease extension

70 years remaining going to be extended to the original term off 99 years for £30,000

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Hi,

Client purchased a property 29 years ago for £80,000.

I presume the correct part disposal calculation was carried out when the original long lease was granted but my client is unsure whether the previous accountant did this.

The tenants would now like to bring the lease term back up to 99 years and in exchange our client will receive £30,000.

Should this extension (or in fact new lease perhaps) be treated in the usual part disposal long lease way or is it the case that the £30,000 is a capital receipt end of story no base cost deductions etc.

I know this is simple but I appear to be having a bad day/week/month!

Thanks

Paul

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By sparish
17th Aug 2017 11:32

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