Selling property can be a stressful event, made even more so by tax obligations and evaluations. The term at ‘arm’s length’ is used to describe a property transaction that’s a ‘normal commercial transaction’ – that is, made by two or more people, who aren’t related by blood, adoption, marriage, or living together.
This is an important determination, because HMRC requires a property valuation for all transactions that haven’t been made at ‘arm’s length’, so they can work out what the market value is, and how to calculate the Capital Gains Tax (CGT) owed.
If you’re letting your property out, and still occupy the property with the tenant, you may be eligible for Lettings Relief, however there are conditions that apply to claim this:
– Part of the property is owner’s only or main residence
– Part of the property is let out (other than in the course of trade or a business).
If you’re handling property, either for sale or let – getting expert advice on how to minimise your tax bills and ensure you’re benefitting from the correct deductions can make a real difference to your finances!
Our team are experts at making tax less taxing, so give us a call or book a consultation today!
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