Taxation logo taxation mission text

Since 1927 the leading authority on tax law, practice and administration

Furniture fun

20 July 2006
Issue: 4067 / Categories: Forum & Feedback

My client owns a furnished holiday letting property, for which he paid £200,000, plus £10,000 for the furniture and contents. He has claimed the 10% wear and tear allowance. Occasionally, other furniture has been purchased, but he has made no claim for the cost of that furniture.
The client is now selling the property for £300,000 and, depending on negotiations, the furniture may be sold for (a) £8,000 or (b) £12,000.

My client owns a furnished holiday letting property for which he paid £200 000 plus £10 000 for the furniture and contents. He has claimed the 10% wear and tear allowance. Occasionally other furniture has been purchased but he has made no claim for the cost of that furniture.
The client is now selling the property for £300 000 and depending on negotiations the furniture may be sold for (a) £8 000 or (b) £12 000.
I think that the capital gain is £100 000 before taper (i.e. one completely ignores the furniture) but what — if anything — is the income tax (or capital gains tax) treatment of the furniture? Is the receipt for the furniture ignored as the cost was ignored? And does it make any difference if the 'pool' of furniture is sold at a gain or at...

Only subscribers may read the full article

Alternatively, you can register free of charge to read a limited amount of subscriber content per month.
Once you have registered, you will receive an email directing you back to read this item in full.
back to top icon