Capital Gains Tax on a partial land sale

wicklowdub · 09-04-2019 10:43PM #1

Hi

Wondering if anyone can help with this query.

We are looking a purchasing a house (this would be our primary private residence)which will be part funded by a loan from a family member. if we were to subsequently sell a part of the site (to build a house on) to the family member for the same value of the loan are we likely to be liable for CGT?

Appreciate any feedback.

Ciaran · 13-04-2019 06:04PM

It's likely that you would be liable to CGT. See example 10 on pages 21 and 22 of this: https://www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-19/19-07-03.pdf

You'd have to use the market value of the part of the site for the calculation instead of the sale price in the linked eample.

Calahonda52 · 14-04-2019 04:43PM

wicklowdub wrote: »

Hi

Wondering if anyone can help with this query.

We are looking a purchasing a house (this would be our primary private residence)which will be part funded by a loan from a family member. if we were to subsequently sell a part of the site (to build a house on) to the family member for the same value of the loan are we likely to be liable for CGT?

Appreciate any feedback.

Is a bank is part funding this?

wicklowdub · 15-04-2019 11:04AM

Calahonda52 wrote: »

Is a bank is part funding this?

Yes but less than a 1/3 of the total transaction, their interest in it wouldnt be reduced by the sale of part of the land, there'd be more than enough equity left.

Calahonda52 · 15-04-2019 06:30PM

wicklowdub wrote: »

Yes but less than a 1/3 of the total transaction, their interest in it wouldnt be reduced by the sale of part of the land, there'd be more than enough equity left.

Best split the site into two now and have two legal titles, else bank may not release its charge to allow you do it later

Capital Gains Tax on a partial land sale

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