Capital Gains Tax (property/profit) (shares/loss) Calculation

landlord

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The intention is to sell a recently purchased property at a profit and also sell some shares at a loss…..trying to calculate the CGT due…


Property purchase costs……
Property 110,000
Solicitor/Stamp duty 3,000
Total 113,000

Selling property…..
Value 153,000
Solicitor 1,000
Estate Agent 1,500
Balance 150,000

Profit liable for CGT 150,000-113,000 = 37,000
At 33% = 12,210
minus 1,270 limit before you pay any CGT= 12,210-1,270 = 10,940


offset against selling shares…..
7,000 shares purchased 7 years ago at 2.92 per share and currently worth 1.45 per share.
7,000 shares at 1.45 will give me now 10,150.
I originally paid 7,000 x 2.92 = 20,440
I will be making a loss of 20,440-10,150 = 10,290

CGT due will be 10,940 – 10,290 = 650 x 33% = 215 ???

Can the commission on sale taken from the stock broker be offset?
Can any renovation to the property before sale be offset.
Anything else I am missing?...thanks
 
Firstly to deal with the CGT

Profit 37,000
- loss -10,290

Gain 26710
AA. -1,270

Taxable gain 25440 x 33% = 8395.

Other issues to consider if you buy something with the intention of selling it then you may be trading. If you renovate the property it may add to the arguememt that you are trading.

If this is a one off deal then it's not an issue but if it happens again then it could cause you a problem.
 
Firstly to deal with the CGT

Profit 37,000
- loss -10,290

Gain 26710
AA. -1,270

Taxable gain 25440 x 33% = 8395.

Other issues to consider if you buy something with the intention of selling it then you may be trading. If you renovate the property it may add to the arguememt that you are trading.

If this is a one off deal then it's not an issue but if it happens again then it could cause you a problem.


Thanks Joe....I guess I got the calculation wrong.....Looks like I am going to have to sell more shares than I thought to offset all of the CGT. Might not be worth it considering I would have to realise such a huge loss on them. The share price seems to be on the rise over the last year or two.

Joe do you have an answer to the question about stock broker commission being offset thanks...
 
Broker costs associated with the disposal are allowed, general mgt not allowed.
 
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