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Business Relief - Subsequent Base Cost

HcksawJimDuggan · 2020-07-25 05:32:23

If an individual inherits a business worth say €600,000 and claims Business relief for CAT purposes, thus reducing the taxable value to €60,000, does the subsequent sale of the business have a base cost of €60,000 or €600,000? I’m aware the sale would have to be after 6 years in order to avoid a clawback.

25-07-2020 5:32am

#1

HcksawJimDuggan

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If an individual inherits a business worth say €600,000 and claims Business relief for CAT purposes, thus reducing the taxable value to €60,000, does the subsequent sale of the business have a base cost of €60,000 or €600,000? I’m aware the sale would have to be after 6 years in order to avoid a clawback.

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#2 27-07-2020 6:39pm

y0ssar1an22

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When an asset is acquired, or disposed of, otherwise than by way of a bargain made at arm’s length, e.g. gift, it is treated as an acquisition or a disposal of the asset for a consideration equal to its market value at that time.

my instinct says that 600k will be your base cost.

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