CGT liability

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    CGT liability

    I'd like to check my understanding of my CGT liability on a property I purchased in May 2013 for £188k, with the intention of letting it.

    The property was in need of refurbishment, and over the first 18 months of ownership I spent £7k on replacing the kitchen, bathroom, cloakroom, flooring, boiler and repainting.

    My plans then changed and I decided to move into it as my main residence which I eventually did in October 2015.

    I lived there until November 2016 when I moved to a different part of the country. The property was then empty until sold in June 2017 for £317k, and so has never been let.

    in terms of calculating my CGT tax liability, is the following correct?

    - the gain is the selling price (minus selling and solicitor costs), less purchase price (plus stamp duty and solicitor costs)?
    - can the gain be further reduced by the £7k refurb costs?
    - having calculated the net gain I have an exemption period (as a proportion of the total period of ownership) from October 2015 to June 2017, this being the period whilst it was my main residence, plus the period after that, since the final 18m is exempt if it has been ever used as a main residence - correct?
    - Finally, I'm sure I read somewhere that the first 12m of the refurbishment can also be exempt from CGT liability, in which case CGT would be due only on the period May 2014 until October 2015 - is that correct?


    If the property has never been let out and all the council tax bills are in your name, , you should claim main residence for the entire period from 2013 to 2017 and exemption to capital gains tax.


      I can't do that because I had PRR on the home I lived in until October 2015, and I can't claim it twice for that period


        This may help you : Helpsheet 283.


          Thank you - very helpful. Unfortunately it seems I cannot claim an additional 12m exemption for refurbishment because of the length of time between purchase and moving in. At least I'm clear now.


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