BTC June 2008/rollover relief

gosia79 Registered Posts: 25 Regular contributor ⭐
Just done this past exam paper (Kaplan revison pack with updated answers) and was suprised that the answer to 1.7 (partner selling office to invest into business)didn't include rollover relief?
Could anyone please explain why?
I thought I know all the rules pretty well and now I am confused again :(

Ps. There is a full question for easier reference

Sent: 13 June 2008
Subject: Help

I know that you are currently dealing with our tax affairs, and wondered if you could help us with some advice.

The business is doing really well this year, and we want to expand by investing some money. I own a block of four offices and I am happy to sell one of them so that I can put some money into the business but I am worried that I will need to pay a lot of tax on any money that I make.

I bought the offices in October 2000 for £250,000 and the biggest one has a market value of about £150,000. The other three are worth about £350,000 between them. These offices are business assets – I don’t know if this is relevant information.

I would therefore be grateful if you could explain to me what the tax implications of selling the office for £150,000 would be, so that I can make an informed decision on the best thing to do.


  • EAP
    EAP Registered Posts: 63 Regular contributor ⭐
    BTC is my weakest subject so I might be wrong but I think this is because you can only claim rollover relief if you reinvest in a qualifying business asset - this includes:
    land and buildings
    fixed plant and machinery
    goodwill for unincorporated businesses only

    so is it because they want to just increase the available cash in the business so aren't really investing in anything concrete? The taxman will never get his hands on the money this way.
  • gosia79
    gosia79 Registered Posts: 25 Regular contributor ⭐
    Thank you, this makes a perfect sense now. :)
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