Reply With QuoteJust out at minute but found this which looks worth a read.
https://www.taxinsider.co.uk/1425-Mo..._Property.html
I’m after a second opinion on a house sale - basic matter is we sold our house, took a deposit then it fell through so we kept the deposit(great!) but we ended up taking less the second time around and incurred extra costs /interest etc. My question is can we add the deposit money amount to the final sale price to work out CGT due(we have some to pay as this wasn’t our main residence 100% of our ownership)? Or is the deposit worked out separately , I.e taxed as income?
Just out at minute but found this which looks worth a read.
https://www.taxinsider.co.uk/1425-Mo..._Property.html
Sorry to hijack, but we're in a situation where we haven't sold our property yet but have had our offer on the house we want to buy accepted but they won't take it off the market and I feel they are going to ask for a deposit.
How much do vendors generally ask for as a deposit? Is it a %?
You only pay the deposit on exchange of contracts, I think we paid 10% last time.Originally Posted by 200mwaterresistant
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My reading of the attached is that the retained deposit is treated separately and is likely to be subject to CGT (without the reduction that you can claim if the property was your home for part of the time you owned it). I'm not sure if the abortive sale costs can be claimed as a deduction. Interest costs are not deductible from a gain in any event. If you still have other let property, you should be able to claim relief on the interest, but not otherwise.
I think it would be worth having a chat with an accountant.
PS Assumes you are UK tax resident.
Last edited by David_D; 23rd July 2018 at 21:22.
No it will be a separate gain so you won’t be able to reduce the chargeable amount with PPR relief. You could deduct any fees you incurred from the aborted sale though
That article is brilliant thanks! Answers everything.
Luckily the deposit fell into 2017/2018 year so I gain full allowance on that and the house sale falls into this year allowing me to use my CGT 18/19 allowance on the non PRR part of the gain.
I did ask my Accontant the question but I didn’t get my usual instant straight forward answer I get from her on every other question so thought I’d do some further research!
As for deposits as far as I’m led to believe unless you exchange contracts a deposit is pretty much a waste of time as it’s not binding.
Great, that's good news then!
You originally said "we" so, if the property was in joint names, you should be able to double up on your allowances.
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