CGT selling part of garden?

G

gidxg03

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Asking this strange question on behalf of my parents. They bought their council house some years ago and were recently approached by the county council who asked could they buy a portion of their back garden to facilitate the council's building of more houses. This suited my parents as they did not need a large back garden and the €70K the council offered was very much needed. However their solicitor now says my parents may have to pay CGT and advises them to talk to an accountant. Is this correct as it is their primary residence (it is their only property).

Thanks in advance for any advice offered.
 
A relation of mine is doing something similar. Now its not being sold to the council but to a private buyer. This relation has had the piece of the garden valued and has been on to her solicitor and she has to pay CGT on the sale of the portion of the garden. I think its 20%. Also I would not just accept what the council are offering i.e 70k. It might be no harm to get the site valued independently.
 
The garden is being sold with development value and therefore relief from CGT as primary residence does not apply. CGT at 20% will be due, after their personal exemptions of €1,270 each ( assuming jointly owned) on the difference between the net sale proceeds and the indexed cost. As the solicitor advised, I'd have them contact an accountant to do the figures properly for them.
 
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