Capital gains tax - Sale of a site

tonycascarino

Just a question if anyone can answer me please. All I see online is an example of capital gains tax where one buys a house for €100,000 and sells it for €300,000 then it is calculated on the €200,000 gain. However, I don't see anything relating to the sale of a site.

Therefore, my question is if a half acre site on a field worth €100,000 was valued at €55,000 and sold for €55,000 then how would capital gains tax be determined on the sale of that site? Thanks in advance.

hold my beer

tonycascarino wrote: »

Just a question if anyone can answer me please. All I see online is an example of capital gains tax where one buys a house for €100,000 and sells it for €300,000 then it is calculated on the €200,000 gain. However, I don't see anything relating to the sale of a site.

Therefore, my question is (for example) if a half acre site on a field worth €100,000 was valued at €55,000 and sold for €55,000 then how would capital gains tax be determined on the sale of that site? Thanks in advance.

What was the cost of the field at the time of acquisition? You apportion that cost to the part being sold. Then compare that to the sale price.

tonycascarino

hold my beer wrote: »

What was the cost of the field at the time of acquisition?

€100,000 at acquisition. The site on it is valued at €55000. How much CGT would be paid for the sale of the site for €55000 based on that? Or can you give me an example instead please as I do not understand exactly.... Thanks by the way.

hold my beer

If the portion being sold cost the same as the price it's being sold for, then there's no gain. Depending when you acquired the land, you may be allowed indexation of the cost price.

If the sale is to a connected party you have to use market value of the site, which might be higher than what you are charging.

tonycascarino

I understand now. Thanks a million.

barneystinson

Part disposal rules apply to this.

Look at examples in this.

https://www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-19/19-01-04.pdf

namenotavailablE

If indexation is available, it would be also worth checking out if 'development land rules' apply, as these restrict the portion of the original acquisition cost which can be indexed.