How to work out expenses for mortgage?

[lithium147]

Companies dont pay stamp duty, but do pay CGT
However, sometimes stamp duty is worse than CGT

For example:
buy property for 400,000
3% stamp duty = 12000

sell property for 450,000
18% CGT of 50,000 = 9000

[jamesbrown]

Taken from my article with credit to planIT Services Ltd

Thanks, Sally. And one potentially needs to consider CGT on sale and business rates if an area is set aside exclusively for business, right?

[lithium147]

CGT might not apply:
HM Revenue & Customs: Capital Gains Tax reliefs for business assets

Rooms used for business and personal use
If you've used a room in your home for both business and private purposes, you'll still qualify for Private Residence Relief on your whole home. For example, you use a room as an office, but you also use it as a guest bedroom. For this reason you don't usually have to pay Capital Gains Tax when you sell or dispose of your main home.

[Sally@InTouch]

Thanks, Sally. And one potentially needs to consider CGT on sale and business rates if an area is set aside exclusively for business, right?

Correct, also add in a change to the contents and building insurance too!

[Sally@InTouch]

CGT might not apply:
HM Revenue & Customs: Capital Gains Tax reliefs for business assets

Thanks for this, but I can't see a reference to the company having contributed towards the mortgage, this is just using a proportion of work space, please correct me if I'm wrong...

[Jessica@WhiteFieldTax]

Companies dont pay stamp duty, but do pay CGT
However, sometimes stamp duty is worse than CGT

For example:
buy property for 400,000
3% stamp duty = 12000

sell property for 450,000
18% CGT of 50,000 = 9000

Stamp duty is a tax on documents, when a asset is purchased. A company would pay stamp duty on a chargeable purchase as a individual would.

CGT is a charge on a sale. In the example we are looking at in this thread, the individual would pay the CGT not the company, but on the basis that a area of the home had been exclusively used for business and expensed against the company.

[Jessica@WhiteFieldTax]

If I have to pay CGT on the portion of the house apportioned to the business (when sold), does that mean I can claim back the stamp duty I paid on that portion when I bought it?

The stamp duty increases the base cost so, yes, if part of the asset was chargeable to CGT you would offset that part of the stamp duty.

[kingcook]

http://forums.contractoruk.com/accou...allowance.html

The shocking thing is that I replied in that thread

Time for a brain transplant.

[SueEllen]

You can get away with not paying business rates if the room can be used as something else i.e. guest bedroom, ironing room, when you aren't using it and you don't have any business visitors to your house.

Linky here.

The VOA information comes from the case explained in this thread

Personally when working at home particularly in winter I charge the extra gas and electricity to the business as this works out as more than £4 a week as the heating isn't normally on all day.

In regards to home insurance there are definitely 2 insurance companies who don't charge you a load more for having a business at home as long as you don't have any business visitors on your premises and the work you do is "computer work". This means there is no way you can separate the extra business cost out from your normal home insurance cost as there isn't any.

[northernladuk]

I suspect nobody has yet given the answer the OP wants to hear, so anything else that is posted is probably futile!

Captainham gets it spot on with this OP.....

Nice call sir.