Capital Gains Tax on Second house.

Bronte said:
Believe it or not there used to be revenue/tax debates about whether replacing windows is repairs or enhancement (capital).
Click to expand...

There still are. It's a standard textbook topic
Bronte said:
For our purposes I'd be going with enhancement.
Click to expand...
Me too, based on the limited information provided, but as its a major item, the OP should establish its allowability or otherwise with a high degree of certainty before proceeding.
Bronte said:
Are you not hiring a professional to do your CGT? If not, do it out yourself and go into revenue and find someone in there who knows CGT and ask them if you've made the correct calculation
Click to expand...

Based on my most recent post above, and on the contents of another thread today in relation to Revenue mishandling/misunderstanding of a relatively straightforward tax issue, this is dangerous advice.
 
Bronte said:
Improvements are also deductable and can be indexed. Have you a reasonable idea of how much these costs were - do a list of what you recall and keep that for future reference - revenue rules in any case state that receipts only need to be kept for 6 years so if you're reasonable about it you shouldn't have any problems
Click to expand...

While you are correct, if you are claiming for something it is advisable to have evidence to back it up. Revenue can audit the return and telling them, with no evidence, may be difficult.
 
Joe_90 said:
I would not claim accountancy fees in a cgt comp. Don't know what others thoughts are.
Click to expand...

Fees re tax advice at planning stage (ie pre-sale) should generally be allowable. There is an argument that fees for preparation of return and computation post-sale are not allowable. This uncertainty means that a decision in each case on whether to deduct has to be made with regard to the facts of the case and the preferences of the taxpayer.
 
I have no connection with accountants other than to employ one for my returns but I agree with T McGibney's earlier advice about employing an Accountant rather than a solicitor unless they have a dual qualification. I suggested to OP in an earlier post to get an Accountant
 
Thanks lads for all the advice, in my ignorance I had presumed that my solicitor either knew how to do all this or would employ on my behalf, for a fee, someone who did, still think he will.

The solicitor is part of a partnership that are also Estate Agents, have used them a few times before and have been happy with their service, never for a sale/CGT job before.

Always like to have my own figures before receiving them from others.

Just to recap,

On purchase of the house, are the stamp duty/legal fees available for relief. think the Legal fees are but no mention of stamp duty on revenue.ie

If both are, are both indexed?

Think I'll forget the €6000 spent on windows and doors as no receipt.

With a bit of feed back from you guys I might put up a few numbers to see what you think.

From what I can see Joe_90 was on the money or very close.
 
1. Deductible expenditure
The amount of a chargeable gain or an allowable loss is determined by deducting any allowable expenditure from the
consideration received for the disposal. The allowable expenditure may include:
(a) the cost of acquisition of the asset and any incidental cost of acquisition such as agent’s commission and costs
of transfer or conveyance,
(b) expenditure incurred for the purpose of enhancing the value of the asset which is reflected in the state of the
asset at the time of disposal; expenditure to establish, preserve or defend legal title,
and
(c) the incidental costs of making the disposal, such as legal and selling costs.​

The amounts under (a) or (b) above may be adjusted to take account of inflation
________________________

9. Enhancement Expenditure
This is the cost of additions to the asset, after the date of acquisition, which adds to the value of the asset and is
reflected in the state of the asset at the date of sale. Examples would be landscaping, addition of a garage,
conservatory. It does not include routine maintenance such as painting.
10. Multiplier​

w
​
​
The multiplier to be applied here must be by reference to the year in which the Enhancement Expenditure at 9
was incurred​


__________________​


7. Cost of Acquisition​
​


w Incidental costs of acquisition such as legal fees and stamp duty are allowable as part of the cost.

http://www.revenue.ie/en/tax/cgt/leaflets/index.html under leaflets 2012 version​

 
Yes the legal fees are allowed and indexed and stamp duty. I wouldn't be worried about not including the windows because you've no receipt. You can prove they are there can't you? Put them under enhancement and index it (for the year you purchased them)
 
Bronte said:
Yes the legal fees are allowed and indexed. I too cannot find stamp duty. I wouldn't be worried about not includiing the windows because you've no receipt. You can prove they are there can't you?
Click to expand...

Stamp duty is allowed where it's a cost of acquisition, which it generally is.

http://www.revenue.ie/en/tax/cgt/leaflets/cgt2.html - see Note 3 to the Computation Sheet - "Incidental costs of acquisition such as legal fees and stamp duty are allowable as part of the cost."
 
mandelbrot said:
Stamp duty is allowed where it's a cost of acquisition, which it generally is.
Click to expand...

Yes I managed to find it in the other document I copied from. But that one you've linked to has a much nicer computation sheet that the OP could work with more easily then the ones at the back of the document I linked.
 
Joe_90 said:
Sales Price less costs 269,000
Less Purchase price translated into €. x indexation 1.356 = €89,532
Gain €179,468
PPR exemption 156/245 (12 years plus last 12 months)
Gain €65,195
Annual Exemption 1270
€63924 x 33% = Approx €21k
Click to expand...

Hi Joe_90
When you are calculating the PPR exemption do you only count full years and add the last year or do you count month as well?

Also the Annual Exemption, is that double for a married couple?

thanks.
 
You must log in or register to reply here.
Back
Top