Capital Gains Tax with 2 different purchase prices.

Thank you everyone for your comments, it's not a straight forward scenario. Yes there was a mortgage owed and the difference between that and the value of the house was , €80, 000. About 6 weeks later the property bubble burst and I was in negative equity for such a long time.
There seems to be different views on how it is calculated and with no feedback from revenue it's hard to know what to do. I will be getting advice from an accountant but like that it's that person's view. It would be great if I was able to offset the loss on one half against gain on the other?
 
If it's calculated in 2 parts, it's possible then that the loss on one half can be offset against the gain therefore
 
Dr Strangelove said:
I think you have to treat it as two parts, not one.
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OK, it is better to do it in two parts because less of the loss on the second part is reduced by the PPR relief.

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jpd said:
But that's not a cash outlay
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If I pay you €80,000 in cash and also assume a debt of €70,000 that you owe to someone else, I’ve given you €150,000. The cash outlay part of a red herring. It’s like when you gift something to someone. There’s no cash outlay but there’s still a notional value which can give rise to taxes like stamp duty, CAT, and CGT.
 
Brendan Burgess said:
OK, it is better to do it in two parts because less of the loss on the second part is reduced by the PPR relief.

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Brendan many thanks for the time you took to put the above together...one question I have, the relief of 3000 I was able to avail of on the 2nd half of the transaction, should this not have given me a greater loss rather than a lower one? Thks, Rosie
 
RosieD said:
I have, the relief of 3000 I was able to avail of on the 2nd half of the transaction, should this not have given me a greater loss rather than a lower one?
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I don't think so.

If you make a capital gain on a PPR you don't pay any CGT. If you make a loss, you can't use that loss against the capital gains on other assets.

Imagine that the second half was an investment property for the whole period of ownership. You could use the loss of €17,000.

But it was a PPR for 2 years, so you must reduce the loss you claim.

Brendan
 
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