Offset selling expenses against rental income?

G

-Gal1

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I am in the process of selling 1 of 2 rental properties in early 2018 and was wondering if I can include the cost of selling (Legal and Estate Agent Fees) against my rental income tax return for 2018? Thanks -Gal1
 
Capital costs like legal and estate agent fees for selling the property are deducted for Capital Gains Tax not income tax.
 
Hi Joe_90
Thanks for the reply.
I do not believe that there will be a CGT liability as the property was a originally a PPR and was valued a lot higher when we moved out a number of years ago.
I am sitting on a capital loss on some shares, if I sold them today. If I sell them at the same time, as the expenses are hitting on the property sale, can I off set the loss on the shares against the cost of the property sale?
 
It doesn't matter what the value of the property was when you moved out.

The calculation only depends on
1. Initial cost, including purchasing expenses - say C. This can be indexed up if purchased before 2001
2. Final selling value less sales expenses - say S
3. Any major improvements or enhancements say E - can be indexed if done before 2001

So Gain = S - C - E

This gain is then divided between eligible for CGT and not eligible for CGT based on the length of time you owned the property and the length of time it was your PPR. If it was rented out for a number of years then

Eligible Gain = Total Gain x (length of time rented - 12 months) / length of time owned
 
And yes, capital losses from shares can be offset against capital gains from property - and vice versa, of course.
 
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