russ295 Posted October 6, 2008 Report Share Posted October 6, 2008 hi all just a quicky, if in a tax year i have put a deposit down on a prop, is that deductable from that years profits. ie if i recieved 10k (profit) in rent and put a deposit of 8k, is the figure for tax 2k. cheers russ Link to comment Share on other sites More sharing options...
Preston Posted October 6, 2008 Report Share Posted October 6, 2008 Hi I am no expert in tax but what you have suggested doesnt seem quite right to me. If I understand it correctly, offsetting a deposit against profit in a rental business in this way would mean that you are treating your property as a trading asset rather than as an investment. It is usually more tax efficient to treat rented property as an investment. If you were to treat the property on which you have paid a deposit as an investment then, whilst I dont think you could offset teh deposit against a rental profit, you could offset any interest charges and fianancing costs(such as brokers fees) against your profit. Or have I got the wrong end of the stick? Preston Link to comment Share on other sites More sharing options...
russ295 Posted October 6, 2008 Author Report Share Posted October 6, 2008 i think you have the right end preston, my accountant was off today and just needed clarification. cheers russ Link to comment Share on other sites More sharing options...
plym77 Posted October 28, 2008 Report Share Posted October 28, 2008 Hi Russ Apologies if this is a bit late - haven't managed to get to the forum for a while. A deposit is capital and income is revenue. You deposit will merely form part of your purchase price and will form part of the CGT computation on sale. Hope this helps clarify Regards Sherena Link to comment Share on other sites More sharing options...
Recommended Posts
Archived
This topic is now archived and is closed to further replies.