I sold the roof space on a loft as the tenant wanted to buy it (I am the freeholder). I only hold the lease with a minimal ground rent per year of £150. Do I pay tax on the loft space I sold, or does this come under the capital gains tax (CGT) annual exemption as I believe that the allowance for last year was £11,100 before paying tax?

Arthur Weller replies:
This sale of roof space on a loft is potentially liable to CGT. The capital gain is simply the amount you sold it for less what you paid for it. However, if your lease was for less than 50 yearsit is classed as a short lease and so a 'wasting asset'. The CGT computation is somewhat more complicated for a wasting asset. But if the gain is less than the £11,100 annual exemption you should have no CGT to pay