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I have a client who has sold a residential house in the US and made a gain of US$500 000 and a sterling gain of £900 000 due to the exchange rates applicable at the time of acquisition and disposal.
Given that the US dollar gain converted at the date of disposal is about £400 000 I am wondering whether I can show the gain in two parts. This is because the residential component will be taxed at 28% whereas the currency gain should be taxed at 20%.
The client is UK resident and domiciled and the property was never an only or main residence. Any advice from Taxation readers about this would be welcome.
Query 19 507 – Transatlantic.
Reply by Goston
The gain is calculated in sterling and cannot be measured in dollars.
A transaction in which an asset is acquired for...
