CGT on sale of site

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cappamj

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I will be getting an accountant to work out cgt later in year but am wondering how much I can expect to pay for site sale. here are the details;

bought 2 sites in 1972 cost £850 extra charges were water connection fees 300 and solicitor 500 total cost 1650. Did not get planning till now so am selling them now at €150k each total €300k. I am not sure how the cgt is worked out in the present situation.
thanks in advance
 
You have to get the land valued at 6/4/74 most auctioneers i think can do this. The inflation /indexation multiplier from 1974/75 to date is 7.528.
Disposal Consideration 300,000
Less Selling costs say 10,000 (Planning Legal & Auctioneers etc)
____________________290,000

Deduct
Value adjusted for inflation at 6/4/74 say £1,000 (€1,270) apply multiplier of 7.528 which equates to €9,561.
Water Connection charges 300 - Is this euro or pounds (when) apply multiplier
Solicitor 500, Is this euro or pounds (when) seems high adjust for inflation prior to 6/4/74 and apply multiplier

Deduct Allowance 1,270

Tax * 20%
Can't work out the exact figures but the above info will help you calculate.

See here specifically chapter 11 1. Sale of an investment property and appendix 1 for inflation /indexation multiplier figures.
 
Indexation relief is not available in respect of development land.

Your only safe option for accurate calculation of the eventual liability is to get professional advice. Depending on your the facts of your situation, there may be some reliefs available.

In the meantime, as a general rule of thumb, budget for a CGT liability of 18% or so of the sale proceeds.
 
cappamj

Did you have any difficulty getting planning on the sites or did you sell them subject to buyer getting planning?? I'm just curious as I'm having a few problems with local Council on something similar.
 
Cosy,
the sites are located on outskirts of town (west of Ireland) I was refused planning twice over the years but now the town sewerage has been extended past the sites so had no problem getting planning now.
 
Indexation relief is not available in respect of development land.
Click to expand...

I do not believe this is a development but stand corrected. The land is being sold with planning. He is not building the houses.

If in doubt talk to an accountant/solicitor, they should be able to advise you.
 
Any site valued at more than the prevailing rate applying to agricultural use is defined as development land for CGT purposes.

It would be hard to imagine a scenario where land sold with PP would not fall within this category.
 
See here Chapter 11 example 2.

The amount allowed for development value increases the amount allowable thereby reducing the CGT payable further.

Enhancement indexation relief is not allowed.
 
See here Chapter 11 example 2.

The amount allowed for development value increases the amount allowable thereby reducing the CGT payable further.

Enhancement indexation relief is not allowed.

Don't know what happened. Server problems I think
 
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