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tax Q


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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?


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  • 3 weeks later...

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



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