Mrs Jones purchased new offices in February 2019 for £400,000 as her current offices were too small. The previous offices she owned were sold in January 2019 for £250,000 and were originally purchased in 2008 for £150,000 including all costs.
Sold for £250,000
Bought for £150,000 including all associated costs
Gain = £100,000
Mrs Jones can offset the gain of £100,000 from the sale of her previous offices against the purchase of the new premises.
The cost of the new premises for assessment of any capital gains when she elects to sell them will be £400,000 – £100,000 = £300,000
This process can be repeated subject to qualifying criteria each time a business asset is sold.
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