Capital Gains Tax

[GarryA]

Hi,

I have a question on CGT,

Can you class a loss on the sale of your own property against CGT?

Say I have CGT calculated at 100k (no losses) I could sell my house cheaper to get rid and I wouldn't really notice in my pocket.

Also when does 28% kick in? For example....

I earn 24k and make a share trade that nets me 50k profit, does part of the profit get done at 18% then the rest at 28% because I have broken the higher earnings threshold?

I will be seeing a professional at some point...

[LC23]

GarryA said:

Hi,

I have a question on CGT,

Can you class a loss on the sale of your own property against CGT?

Say I have CGT calculated at 100k (no losses) I could sell my house cheaper to get rid and I wouldn't really notice in my pocket.

Also when does 28% kick in? For example....

I earn 24k and make a share trade that nets me 50k profit, does part of the profit get done at 18% then the rest at 28% because I have broken the higher earnings threshold?

I will be seeing a professional at some point...

If the property is your main residence then any gain or loss on it is not considered for CGT purposes. So no, you cannot sell to create a useable loss. Why would you want to anyway?

Gains made up to and including 22 June 2010 were taxed at a flat 18% after the annual allowance is offset. From 23 June there are the 18% and 28% rates.

For gains on or after 23 June 2010, individuals need to work out their total taxable income before working out which Capital Gains Tax rate to use. The below should give you a good idea of how your work out what is taxed at which rates.

1.First work out your taxable income by deducting any tax-free allowances and reliefs that you are entitled to.
2.Next see how much of your basic rate band is already being used against your taxable income. The basic rate band for 2010-11 is £37,400. For 2011-12 it is £35,000.
3.Allocate any remaining basic rate band first against gains that qualify for Entrepreneurs' Relief - these are charged at 10 per cent.
4.Next allocate any remaining basic rate band against your other gains, these are charged at 18 per cent.
5.Any remaining gains above the basic rate band are charged at 28 per cent.