Capital Gains Tax – O’Donnell v HMRC [2017] UKFTT 347

 In Tax

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When a property is sold, what expenses and losses can be deducted by the seller in computing the chargeable gain? Can a seller ever deduct costs incurred by the buyer of his property?

Case Summary from LawSkills | Private Client specialist trainersThe appellant, Mr O’Donnell, owned several properties which he had mortgaged. After being adversely affected by the financial crisis of 2008, the mortgagor bank called for immediate repayment of the loan, threatening sale of the properties at auction unless Mr O’Donnell repaid his loan within a couple of weeks. After a frantic search for new funding, his uncle came to the rescue at the last minute, and bought the properties from him. Mr O’Donnell had not disclosed the sale to HMRC on the basis that he had made a loss. This hearing relates to tax and penalties charged to him once HMRC became aware of the sale, which they believed had given rise to a taxable gain.

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