I have separated from my wife, and we recently sold our family home. We bought a house for her in her name only and I have bought a shop in my name with planning permission to convert the rear to a two-bedroom flat, which I am currently doing with the intention of staying there. I am considering selling the front shop premises and would like to know the tax implications in doing so. This is my sole property.
Arthur Weller replies:
The front part of your new property is obviously separate from the back part because the back part is being converted to a 'dwelling', and it seems the front part is still a shop. If so, the tax implications of selling the front are straightforward. You need to apportion the purchase price of the whole property, between the front and the back parts, and then you can see whether the sale of the front shop premises produces a capital gain.