CGT - Partial PRR calculation
Discussion
Hi guys, will speak to an accountant but until then just want to get a rough idea of cgt liability. In summary:
Typical newsagents with dwelling behind and above, which was genuinely used as main and only residence from purchase (in 1990's) until recently. Property always classified as commercial until recently when it was changed to private (as newsagents had long gone).
My understanding is partial private residence relief is available on the portion that was used for living, but how do we calculate that? Is it literally a case of sqr ft and working out how much is private vs commercial?
Typical newsagents with dwelling behind and above, which was genuinely used as main and only residence from purchase (in 1990's) until recently. Property always classified as commercial until recently when it was changed to private (as newsagents had long gone).
My understanding is partial private residence relief is available on the portion that was used for living, but how do we calculate that? Is it literally a case of sqr ft and working out how much is private vs commercial?
Thanks, yes it's easy to work out but wasn't sure if that is how it was done. Just so my understanding is correct, is it as simple as:
total property is 1000sq ft for example
200 is the shop
800 is living
I would simply allocate 20% of the gain to the shop and not deduct any relief from it, and the opposite with the 800?
total property is 1000sq ft for example
200 is the shop
800 is living
I would simply allocate 20% of the gain to the shop and not deduct any relief from it, and the opposite with the 800?
Might be the % value rather than the % sq ft?
What % of the bills were claimed as business?
Was the resident running the business as a sole trader?
Possibly the event which gives rise to a potential CGT liability is the cessation of trade and re-classification of the property, rather than the subsequent sale?
Personally I would search the HMRC website, maybe those of relevant organisations and consider asking HMRC, because their opinion matters a lot more than randoms on the web trying to apply logic to tax.
What % of the bills were claimed as business?
Was the resident running the business as a sole trader?
Possibly the event which gives rise to a potential CGT liability is the cessation of trade and re-classification of the property, rather than the subsequent sale?
Personally I would search the HMRC website, maybe those of relevant organisations and consider asking HMRC, because their opinion matters a lot more than randoms on the web trying to apply logic to tax.
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