Allowable legal costs for tax purposes?

by Readers Question

13:04 PM, 26th March 2021
About 3 weeks ago

Allowable legal costs for tax purposes?

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Allowable legal costs for tax purposes?

Hi everyone, I have just been through a very difficult and complicated divorce. I have been a landlord for many years and acquired 8 rental properties, two were in joint names, and as part of the settlement my ex-husband agreed to transfer these to my name.

I remortgaged 4 properties to buy him out.

My question is can I include the solicitors costs for transfers and remortgaged on my tax return. I know I can’t for my divorce solicitor but thought maybe I could for my conveyancing solicitor.

Thank you in advance

Christine

Comments

Alistair Cooper

14:26 PM, 26th March 2021
About 3 weeks ago

Transfer costs could be off set as capital costs; ie against CGT on any future sale
Remortgage fees & related solicitors fees would be considered as finance costs so now due to Sec 24 relief will be restricted to basic rate of 20%
Interest on the new mortgages will benefit from 20% relief as long as their aggregate value does not exceed the value of the properties on the first day they were let.

Christine Turner

22:50 PM, 26th March 2021
About 3 weeks ago

Reply to the comment left by Alistair Cooper at 26/03/2021 - 14:26
Thank you, that’s very helpful


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