CGT made simple....please?

[jackk19]

Hi Pani and Nigel,

I have previously asked about CGT but still have some unanswered questions swimming around my head.

This is my situation. I am a British born Greek Cypriot (non-resident of Cyprus). I have been given land by my mother (title deeds in my name). She is very much alive and so does this still counts as a gift?

About 15years ago I sold a residential plot for 25k Cyprus pounds. I now have an offer for agricultural land (thanks Pani for the reply).

Nigel states in his guide that the CGT allowance is as follows:

1) Up to €85,430 if the disposal relates to a private residence.

2) Up to €25,629 if the disposal is made by a farmer and it relates to agricultural land.

3) Up to €17,086 on any other disposal.

Do I qualify for either 2), if I sell agricultural land or as I am not a farmer is it 3). Number 1 is for anyone who has lived in the property for more than 5 years.

As for the CGT allowance I think I may have missed the boat on previous discussions in understanding. The allowance is given on the amount of CGT calculated on the sale of a property. So in general terms, if a property is 100k then the CGT is 20k and the allowance will be based on the 20K? So unless you sell a property worth 500k you should not pay any CGT?
Or is the CGT allowance based on actual sale price of your property. For example if it is 85k then on a 500k home you pay CGT on 415k?

On a sale of immovable property would I pay any UK CGT by bringing back the proceeds to the UK?

Will I pay transfer fees?

Thanks

Kyriacos

[jackk19]

Hi,

After some further reading I think the CGT is pais on the profit realised from the disposal and any exemption is deducted from that profit.

Where I became a bit confused is on a previous post Nigel stated:

I believe that each time you sell a property, whatever Capital Gains Tax allowance you are granted is deducted from €85,430.07.

Eg. If you get an allowance of (say) €20,000 when you sell your first house, that amount is deducted from your €85,430.07 lifetime allowance, leaving you with a balance of €65,430.07. If you sell you second house and get an allowance of (say) €30,000, that amount is deducted from the remainder of your lifetime allowance (€65,430.07), leaving you with a balance of €35,430.07 - and so it goes on. Once you have exhausted your lifetime allowance, you cannot claim any more.

I read the above as an allowance on the calculated amount of CGT from the sale and profit of a disposal.

[Pantheman]

Jack,

I am not so sure about the 85k allowance Nigel mentioned and it's new to me. I only ever thought it related to your permanent residence of 5 years or more.

Any how, CGT is calculated, given you didn't pay for the land so it was zero purchase price, subtracting from the sale price the value shown on the title. This is the 1.1.80 value.

Then there will be some inflationary deductions (some ghovernment tables are used), and then the allowance for agricultural land.

As for your previous sale, maybe no allowance was used so you mays till get it.

My aunt sold a plot for cy£150k, she paid about cy£26k CGT, so this is why I am doubting the 85k rule that nigel mentions.

Sorry mate, you're just gonna have to pay it.

Paying CGT in Cyprus means you do not pay it in the UK. DTT. This is because UK CGT is slightly less than Cyp. Had it been more, the UK would be demanding the extra. Anyway, you have to terll them first

[Nigel Howarth]

Hi jakk19,

There's a long article on Capital Gains Tax written by a professor of law at http://www.news.cyprus-property-buyers. ... 2/id=00673

Regards,