Get The Basics Right When Selling Your Residential Property
Many people selling a buy-to-let property have a significant profit on the sale, less the original cost. The Capital Gains Tax (CGT) rate of 28% is payable on this gain less your CGT annual exemption.
However, in our experience, taxpayers don’t retain invoices that support improvement costs that have been incurred during the period of ownership. Invoices are required to qualify as a deductible cost and whilst we also understand why people pay cash for certain work, by doing that, you may be ineligible to claim that cost on a sale.
Each year, we see taxpayers miss out on thousands of pounds of tax relief due to their lack of record keeping. Tax is hard enough without getting the basics wrong. Good record keeping ensures that you can successfully claim valuable tax reliefs.
Property Taxpert, David Morrison, commented:
“Tax is often very complicated, and it can be frustrating when clients miss out on valuable tax reliefs on costs incurred as they haven’t kept sufficient records. Why not ask your accountant to keep those records for you in their permanent files, and if they prefer not to, then give EQ a call and we’ll be happy to oblige.”
Should you have queries on claiming tax relief, or any aspect of selling your residential property, please contact the Residential Property Taxperts.