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Capital gains after selling rental property

  • 04-08-2020 8:37pm
    #1
    Jonathan222
    Registered Users Posts: 91 ✭✭


    Hello all.

    Recently sold a rental property but not sure what the implications are for tax purposes, from a reporting point of view, I.e. where do I reflect the capital loss?

    Setting the scene.
    Bought house for say 300k in 2008
    Sold for 220 in 2020, so a loss of 80k (no neg equity thankfully and literally cleared the mortgage give or take 200 euro.).

    Annually complete an online form 11, due to the rental income.

    My question is do I include he 80k somewhere in the form 11 or is there a separate form I need to complete seperately, which is then automatically included in any form 11 I complete online?

    Any help would be great.

    Thanks.


Comments

  • #2
    Geuze
    Registered Users Posts: 13,064 ✭✭✭✭Geuze


    Is this any help?

    https://revenue.ie/en/gains-gifts-and-inheritance/transfering-an-asset/when-and-how-do-you-pay-and-file-cgt.aspx


  • #3
    ismat
    Registered Users Posts: 167 ✭✭ismat


    There is a cgt section on the form 11 that you complete with the details of the loss


  • #4
    Happy4all
    Closed Accounts Posts: 2,089 ✭✭✭Happy4all


    Jonathan222 wrote: »
    Hello all.

    Recently sold a rental property but not sure what the implications are for tax purposes, from a reporting point of view, I.e. where do I reflect the capital loss?

    Setting the scene.
    Bought house for say 300k in 2008
    Sold for 220 in 2020, so a loss of 80k (no neg equity thankfully and literally cleared the mortgage give or take 200 euro.).

    Annually complete an online form 11, due to the rental income.

    My question is do I include he 80k somewhere in the form 11 or is there a separate form I need to complete seperately, which is then automatically included in any form 11 I complete online?

    Any help would be great.

    Thanks.

    Yes you report in on your 2020 Form 11. There is a section for CGT


  • #5
    Jonathan222
    Registered Users Posts: 91 ✭✭Jonathan222


    Geuze wrote: »
    Is this any help?

    https://revenue.ie/en/gains-gifts-and-inheritance/transfering-an-asset/when-and-how-do-you-pay-and-file-cgt.aspx


    Thanks for that. It certainly helps only on the link it says, for disposals between: (I'm using this period as that is when contracts were signed)

    "1 December and 31 December (the later period), you must pay CGT by 31 January of the next year." Yet it then goes on to say using the Form 11 you must file by 31 Oct the following year, so 2020 in this case.

    So should I have paid any GCT by end of Jan 2020 (even though it's a loss as I sold at a loss) or do I pay when I submit my Form 11?

    Thanks.


  • #6
    Jonathan222
    Registered Users Posts: 91 ✭✭Jonathan222


    Calahonda52 wrote: »
    it's when you received the proceeds, not when contracts were signed.

    Ok, that helps, so if I closed/got proceeds mid Dec 2019, I would have to pay GCT by 31 Jan 2020 and then just note it in my form 11 submitted by 31 Oct 2019?

    And do I need to complete a separate form in additional to my form 11 or can I do it all on my form 11 when I pay and file?

    Thanks.


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  • #7
    Calahonda52
    Registered Users Posts: 12,193 ✭✭✭✭Calahonda52


    Are you not making a loss, so where is the CGT payment coming from?

    “I can’t pay my staff or mortgage with instagram likes”.



  • #8
    Calahonda52
    Registered Users Posts: 12,193 ✭✭✭✭Calahonda52


    Calahonda52 wrote: »
    it's when you received the proceeds, not when contracts were signed.

    Looks like I was wrong here:

    from the link
    For disposals made under a written contract, the time of disposal is usually the date of the contract.

    “I can’t pay my staff or mortgage with instagram likes”.



  • #9
    Jonathan222
    Registered Users Posts: 91 ✭✭Jonathan222


    Calahonda52 wrote: »
    Looks like I was wrong here:

    from the link
    For disposals made under a written contract, the time of disposal is usually the date of the contract.

    Thought that, and agree I am making a loss on the sale (purchase minus sale price) but I suppose I'm just trying to make sure I do it right and reflect in the form 11 and any other form i have to complete(if any cause there is no gain). The December date is throwing me though as my solicitor said technically we did close in Dec 2019 (signed contracts) but with other delays and Covid, handover of keys did not happen until late May.

    Or is it the case, I populate the capital loss on the 2019 form 11 which them calculates how much I have to pay from an income tax point of view (if any as I may able to apportion a certain amount) and file .

    Appreciate all your responses on this.


  • #10
    Calahonda52
    Registered Users Posts: 12,193 ✭✭✭✭Calahonda52


    the losses are ring fenced to asset sales so no spill over into income tax

    “I can’t pay my staff or mortgage with instagram likes”.



  • #11
    Jonathan222
    Registered Users Posts: 91 ✭✭Jonathan222


    Calahonda52 wrote: »
    the losses are ring fenced to asset sales so no spill over into income tax

    So for any capital loss one would not be put against any form 11 total income tax liability once I do my form 11 by end of Oct? So if my income tax liability was 5k and I had a capital loss of 10k, I could not use 5k of the loss to offset the income tax?

    So a capital loss carried forward can only be offset against capital gains? So of I never have any capital gains it means i can never offset it.


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  • #12
    Geuze
    Registered Users Posts: 13,064 ✭✭✭✭Geuze


    Jonathan222 wrote: »
    So for any capital loss one would not be put against any form 11 total income tax liability once I do my form 11 by end of Oct? So if my income tax liability was 5k and I had a capital loss of 10k, I could not use 5k of the loss to offset the income tax?

    So a capital loss carried forward can only be offset against capital gains? So of I never have any capital gains it means i can never offset it.

    All correct.

    IT and CGT totally separate.


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