Small part disposals of land
In this lesson, you'll learn how to handle small part disposals of land and when you can elect to defer a capital gains tax bill. This is an important tax planning opportunity that many students miss, so understanding the conditions and mechanics will help you spot it in exam questions.
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In this lesson
- 0:00 Small part disposals overview
- 0:26 Defining small proceeds threshold
- 1:05 Election treatment and base cost adjustment
About this lesson
You'll discover what qualifies as a "small" disposal: proceeds must be less than 20% of the land and building's value before disposal, and total proceeds from all land sales in the tax year must be under £20,000. When both conditions are met, you can elect to avoid the part disposal calculation entirely. The key benefit is deferral rather than avoidance. Instead of triggering a capital gains tax charge now, the proceeds are simply deducted from the base cost, reducing it for future calculations. This means the gain is pushed forward to a later disposal, giving you valuable timing flexibility in your tax planning strategy.
Duration: 1m
Transcript
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