CGT on deregistered B&B

[miker]

Hi,

Hopefully I'm posting this in the correct place.

My mother in law has been living in her PPR for over 40 years, for 10 years the house was also registered as a B&B, For the last 5 years the B&B was deregistered.

The split would have been 50% commercial and 50% residential. She is separated and living on her own and would now like to downsize the house. Due to the fact the business ceased trading 5 years ago is she still liable to pay CGT on 50% of the sale? Minus original cost, solicitors fees etc ?

I read that if the B&B was deregistered more than 3 years ago then she would not be liable, but cannot find any thing concrete to back this up.

Any help/advice much appreciated.

Thanks
Mike

 

[T McGibney]

She needs specific professional advice from an experienced accountant or tax advisor.

Hi,
I read that if the B&B was deregistered more than 3 years ago then she would not be liable.

This doesn't seem correct.

 

[miker]

Hi T,

She had asked her accountant for advice. But he wouldn't/couldn't give a straight answer until he know what figures he was dealing with. Which didn't fill me with confidence. From speaking to our own accountant they suggested that she will have to pay CGT on 50% of the sale minus the costs. Which doesn't really make it worth selling, if this is the case?

 

[T McGibney]

Hi Miker

She needs to find a tax consultant or an accountant who knows their way around this stuff. Her own accountant may well fit that bill, he's 100% correct though to refuse to give a straight answer until he knows exactly what figures he's dealing with. I'd probably say the same myself as I've seen cases where huge time effort and worry was wasted on scenarios based on incomplete information that became redundant once the full circumstances were established.

She may well end up stuck with a CGT bill but a 50% business/residential split sounds laughable if the place was used as a B&B for only 10 of the 40 years she owned it.

 

[miker]

Thanks T.