Capital Gains Tax !

Collapse
X
  • Filter
  • Time
  • Show
Clear All
new posts

    Capital Gains Tax !

    Ok you clever people , I could make this very long but I will try and keep it short , How do you no or find out if you have to pay this tax ? I have a few property,s and would like to sell the largest one but have been told if I'm not the payer of the bills I only have 18 months and then its not my main house and would be liable for 40% taxed on the profit ( which would be loads as we have had the house in our joint names for 23 years ( moved out 2 years ago ) I no its not black and white and for some strange reason no one seems to no the truth on this high property tax , Thank you for reading this and any fed back would be great .

    #2
    I'm am assuming this property you are selling was previously rented out, and therefore was not your main residence, if this is the case you will be liable to CGT, the exception is only for your main residence, if you can prove you lived there prior to selling it you could then get the relief of CGT on this.

    Comment


      #3
      Reading "no" as "know", and assuming you have copyright clearance.

      It is not a property tax; it might better be described as an investment tax. Also it is not 40%; the rate depends on your marginal rate of tax, and whether or not the gain is on residential property, but no rate is currently greater than 28%.

      The answer to the main question is that any investor is expected to keep proper records and submit proper tax returns. Given that, in London, most BtL landlords are aiming for a capital gain, all should have factored CGT in from the start of the business.

      The real question here is to the extent that you have exemption as the result of its being your main home. Whilst that exemption may still apply to you, it is not really intended for people with large portfolios. I think the aim is that it allows people to work away from home, or not sell their old home immediately, if selling proves difficult.

      Rather than try to summarise the rules and get them wrong, start here: https://www.gov.uk/tax-sell-home In particular I wonder if you actually bought as an investment, even though you lived in it, which might void the allowance.

      Comment


        #4
        Paying of (utility) bills has nothing whatsoever to do with ownership with respect to Capital gains.

        If you lived there for 23 years and rented it out for 2 years, GCT would almost certainly be zero.

        But you seem not to have lived there - or did you????. The amount of time you "get" is zero -- not sure where the 18month idea comes from..... that is only applicable if it was your primary and only residence.

        It is (mostly) black and white.

        Yes I generally know the truth.

        You need to describe the thing exactly to get to that truth.

        Comment


          #5
          Thanks for your replys , The house was our main living house until 2 years ago when we down sized ,we never rented the house out as tried to sell it but it fell threw a couple of times so no we never rented this house , Our tax records are all complete and up to date with the other propertys , We don't want to sell the house and then get a very lg CGT as you could imagine ,again thank you all for your valuable time .

          Comment


            #6
            Then your CGT bill will almost certainly be zero.

            Unless it is an extremely expensive property and increased in value by at least a million or so (given two basic CGT exemptions) -- if that is the case you will need to look at precise numbers.

            Can you prove it was your only or designated main residence for all of that period (minus 2 years)?

            Comment


              #7
              Thank you .

              Comment


                #8
                If you have lived in the property for 21 years out of 23 years , the tax office will give exemption to capital gains tax for 21 years + 18 months from date of moving out. So only the gain for last 6 months is taxable.

                If your capital gain over 23 years gives you £460,000 profit which is a gain of £20,000 per year. Your tax able gain for 6 months period is £10,000 . You have a capital gains allowance of £11,000 so there will be no tax to pay.

                Comment


                  #9
                  If the property never rented, it never became part of a property investment business, so the property never become an investment.
                  The rules in second property sales are fairly simple, and the actual answer will depend on where you actually lived and what, if anything, you told HMRC (about which was your main home for example).
                  When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
                  Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

                  Comment

                  Latest Activity

                  Collapse

                  • Allowable expenses on property income
                    Landlord123!
                    Hi,

                    Are the following costs allowable (tax deductible) expenses on property income?

                    1. Accountant fees for compiling and submitting my self assessment every year.

                    2. Legal fees for transferring the ownership of the property from my sole name to joint names (with...
                    25-05-2018, 11:30 AM
                  • Reply to Allowable expenses on property income
                    jpkeates
                    I don't see that.

                    A fee paid to a solicitor for legal advice or for conveyancing is not a "fee paid for ...registration of title on property purchase".
                    That's something that would be paid to the land registry.

                    It's an anomalous exception in any case, because...
                    26-05-2018, 09:40 AM
                  • Reply to Allowable expenses on property income
                    AndrewDod
                    Correct. And not legal fees relating to this aspect either....
                    26-05-2018, 09:11 AM
                  • Rent a room scheme
                    K335D
                    Hi,

                    I have read up on this subject but I am unclear re the following scenario.

                    I own my own home in Glasgow. This is my only home.

                    I have been made redundant, and my work is offering relocation to London.

                    I would like to retain my home in Glasgow -...
                    24-05-2018, 13:59 PM
                  • Reply to Rent a room scheme
                    theartfullodger
                    Gordon spot on, but in Scotland a lodger is does not have a licence but a "common law tenancy" (paperwork suggestions Gordon makes I'd agree with...) and if he doesn't go when asked you need a Sheriff Court decree - see...
                    https://scotland.shelter.org.uk/get_...vice_topics/re...
                    26-05-2018, 08:43 AM
                  • Reply to Rent a room scheme
                    Gordon999
                    There is nothing to prevent OP keeping his home in Glasgow and taking on a lodger.

                    But the lodger must be covered by a licence stating the payment of rent ( weekly or fortnightly or monthly ) and what notice period must be served to quit by each side .

                    https://www.gov.uk/p...
                    26-05-2018, 04:16 AM
                  • Reply to Allowable expenses on property income
                    Gordon999
                    The Notes for SA105 Tax return gives the expenses for entering in box 27 as shown below :

                    Box 27 Legal, management and other professional fees

                    You can claim:
                    • management fees paid to an agent for rent collection, advertising and administration
                    • legal and...
                    26-05-2018, 02:10 AM
                  • Reply to Allowable expenses on property income
                    AndrewDod
                    I am not sure I agree on the legal fees for transferral jp.

                    Take spouse part out of it as that complicates it. If I were to transfer part of a property to my friend, that cost of transfer would be capital and offset against later capital gains. Not really different from selling the whole...
                    25-05-2018, 19:14 PM
                  • Reply to Allowable expenses on property income
                    jpkeates
                    If the property is let or about to be let, 2 is definitely allowable.

                    1 is debatable.
                    It's something that everyone does (including me), but it probably fails the solely and exclusively test, so it probably shouldn't be allowed.
                    For many people, the need for it arises as a direct...
                    25-05-2018, 12:42 PM
                  • Reply to Rent a room scheme
                    jpkeates
                    There's a significant difference between a main residence for tax purposes and a main residence for a property licence.
                    You can nominate your principle residence for tax purposes (as many MPs do) which is fine for tax purposes.

                    It doesn't have the same effect when it comes to determining...
                    25-05-2018, 09:35 AM
                  Working...
                  X