Auctioneer fees used in sale of rented property and CGT

M

modestus

Registered User
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I seems that it would lessen the CGT liability payable by using the more expensive auctioneering company for sale of rented property as a large auctioneering company would have greater marketing coverage than a smaller auctioneer and the larger auctioneering fee payable will be a greater deduction against CGT payable
Is my logic flawed in this thinking ?Anyone agree or disagree?
 

Yes.

I'm not denying that a larger firm would have greater coverage, but are you suggesting that a higher auctioneering bill is more desirable as it will reduce your tax bill.

Example:

Gain before auctioneer fees 105K
Auctioneer Fees 5K
Taxable Gain 100K
Tax Due @20% 20K

or

Gain before auctioneer fees 105K
Auctioneer Fees 15K
Taxable Gain 90K
Tax Due @20% 18K

You've saved 2K tax but paid an extra 10K to make that saving.
 
Ham Slicer many thanks-you are of course right-it would seem strange that a higher auctioneers fee would lessen CGT -in reality I see that the higher fee paid leads to mimimal lessening in CGT -the moral of the story is it is still better to use a cheaper auctioneer
Many thanks
 
When you compare the cost of the auctioneers you should be comparing 80% of their charges

As in Ham Slicers example, for every €1000 you spend on the auctioneer it really costs you after tax €800

In regards picking one auctioneer it depends on how much "interest" in the property will increase the price
If you were to sell a 3 bed semi in an estate with 4-5 houses on the market it really doesn't matter which estate agent you go with
The price will be set by the amount of interest in the area and the asking price for the other properties

If you want to sell something not standard, stand alone house, land etc, picking the auctioneer who is likely to have the right clients for the purchase can be more important than in the previous example

stuart@buyingtolet.ie
 
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