Andrew Jenkins

I would like some advice on what the CGT requirements are when property is split and sold separately. Scenario, my family bought a public house in the 80s. We intend to split off a small section of the pub and sell this as a development plot with the pub remaining in family possession. I assume that as the development plot was originally part of the pub purchase it needs to be considered for CGT in relation to that purchase, and therefore i need to work out the gain from the sale in relation to its share of the original property value to find the capital. I guess the only way to do this would be work out a % split based on current values (sale price for plot + estimated market value for pub), i.e. Apportionment (%) to plot = Actual plot sale price / Total value of property, i.e. Actual Plot sale price + Estimated market value of pub Apportionment(£) of original pub buy price to plot = Apportionment (%) to plot x original purchase price. Capital gains apportioned to the plot = Plot sale price - Apportionment(£) of original pub buy price to plot CGT due for plot = capital gains apportioned to the plot x CGT rate Then when the pub is eventually sold in the future the CGT due is worked out using its apportioned % (what is remaining) = 1 - % apportioned to plot Can you please confirm if my thinking is correct? Many thanks