What are the Tax Implications of Buying Flat on Monthly Installments?

Q. I am currently let out of a flat and the tenants have approached me with an offer of buying the flat on a monthly installment plan instead of getting a mortgage and paying at point of sale as would be the usual situation on a sale of a property. What are the tax implications?


A: From a capital gains tax (CGT) perspective the sale is treated as selling the whole property on the date of the exchange of contracts, even though the sale proceeds will be received over a period of time. However, you do have the option of paying the CGT in installments on application to HMRC.


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