I have an internet sales business - a while ago I built another site which is a going concern and I woudl like to sell it. Apart from finding it hard to value, I don't know what capital gains tax I would have to pay - I want to keep the money I get for it for personal use (probably up to £5000). I can't put a cost on the building of the business- it was mostly my time (a lot of it!) with small amount of money on software and then advertising. I will be keeping the main business going. I am a sole trader with no employees. Can someone please advise if any lump sum I receive from the sale will attract CGT? Thanks.
Selling Part of a Business - CGT?
Nov 26, 2007
7 Replies
You have an allowance of £9,200 this year so you shouldn't pay any tax.
Thank you!
That assumes that the money would indeed be deemed a capital gain. It may well be the case that it would be, but it might not be.
She had an existing business, and then built another one. Did she build it with the intention of running it herself, to complement or supplement her pre-existing one, or did she build it with a view to selling it?
If the latter, then the proceeds would be taxed as income, not as gain, wouldn't they? If so, the £9200 allowance would not apply.
It was built to complement the main site (we were having problems with Google listings at the time so needed a more keyword specific site - I'm giving up due to ill-health so selling this site first and the other one when I can change career).
You may find that it's best to sell the two businesses either side of
5 April because you use two years annual allowance. You should also consider the possible change in CGT rates after 5 April 2008.
If you are not paying tax on the income you receive from the site I think the CGT issue will be insignificant when HMRC catch up with you. Are you paying tax on the income from the site?
Yes - it's bundled in with income from the main site.
Join the Discussion
Have something to add? Share your thoughts — no account required.
Didn't find your answer?
Ask the community — no account required