Wife Entitled to Maintenance Until Sale of Family Home
When divorcing couples disagree on how assets should be divided, the courts will seek to arrive at a fair outcome for both parties. In deciding how the proceeds of sale...
Continue readingCapital Gains Tax (CGT) is a complex tax, but the guiding principle is straightforward. It taxes gains on the disposal of non-trading assets. For a person, profits on trading transactions are taxed to Income Tax. Losses on non-trading disposals can be set against capital gains made in the same tax year or carried forward to be set against gains in future years…but not, it seems, all losses.
A recent case dealt with the situation in which a man paid a deposit of £72,000 for a property, but was subsequently unable to complete the purchase, with the result that he lost the deposit.
He claimed that the forfeited deposit was a loss for CGT purposes and so would be available to be set against a future capital gain. Not so, said HM Revenue and Customs (HMRC). He had never completed his contract and therefore there was no ‘disposal’ – there was no transaction for CGT purposes at all.
The Upper Tribunal accepted HMRC’s argument, leaving the lost deposit as a pure loss which cannot be used to mitigate the tax on a future gain.