Readers’ forum: Second home

A married couple living together intend to purchase a property in addition to their main residence which may be let after refurbishment or then sold. The husband is a 40% taxpayer and the wife is a 20% taxpayer and they want to ensure that the profit on sale is divided between them in the most beneficial way whether it is a trading profit or a capital gain.

They will be providing the funds equally from their own resources and will enter into a joint mortgage and presumably will own the property as joint tenants. For capital gains tax purposes the gain would be divided equally between them but they want any income from letting and any trading profit to be allocated 20% to the husband and 80% to the wife. For this purpose an election using form 17 should be made and the procedure seems to be to...