Changes to CGT When Selling a Previous Residential Property

  • Filter
  • Time
  • Show
Clear All
new posts

  • AndrewDod
    To clarify the above further - it is not how much increase there has been over 2 years -- but the TOTAL increase in price over 22 years x 2/22 (just using 1 year for easier calculation). So if the price increased (over the 22 years) by more than 22/2 x the CGT allowance you would pay tax (an increase of maybe less than about £130K in price over 22 years you would escape tax) -- there are various other adjustments like legal costs. Lettings relief will be gone.

    But you should sell fast - 2 years have passed and the tax is rapidly going to start biting ..... so after another 2 years you will pay tax if the price has increased by about £66 K since you bought it 22 years ago. That number is going change every month you wait.

    It is TOTALLY irrelevant that the price has decreased since you first let it out -- that does not help you much at all (apart from reducing the absolute gain a bit). Understand that or be burned....

    Leave a comment:

  • Claymore
    Thank you.

    Leave a comment:

  • Gordon999
    The capital gain achieved by the property during " owner occupation " is exempt for cgt.

    Using your example , taking the total period of ownership at 22 years, the total period for owner occupation is currently counted as 20 years stay + 18 months after moving out.
    But after 6 April 2020, the 18 months period reduces to 9 months. Also the lettings relief can only be claimed if the owner was living with a lodger.

    So you would be charged tax on capital gain only for the rental period = 1 year + 3 months .

    Leave a comment:

  • Changes to CGT When Selling a Previous Residential Property


    I think I heard there are changes being made to Private Residential Relief, as in that it is being completely removed?

    If I lived in my property for 20 years, then let it out for 2 years, am I due to pay CGT on 2 of the 22 years (ie, the gain over 22 years, divided by 22 and multiplied by 2). Or is there a way that the CGT can be calculated from the time it has been rented out? The property has actually decreased in value since letting out.

    Grateful for clarifications on new rules.

    Many thanks

Latest Activity


  • CGT under the threshold once split with husband?
    by stuco
    Hi hoping someone can clarify...

    I'm busy doing 2019-20 return. We sold a BTL during that year for £79500. As it was jointly owned between me and husband do I treat it as selling for £39750 for my part (and his) and therefore below the £48000 amount that you have to report on SA for...
    08-04-2020, 10:29 AM
  • Reply to Implications of Gifting a % of Property
    by Lawcruncher
    Things to consider:

    Think carefully before giving assets away as you do not know what the future holds.

    If you put an asset into trust or give it away as part of a tax planning exercise you are going to lose control over it.

    If you have fears about what may happen...
    07-04-2020, 15:54 PM
  • Implications of Gifting a % of Property
    by Claymore

    My main residence is unencumbered. I am thinking ahead (with the thought of the 7 year rule on inheritance tax).

    If I gift my son 50% of my property now - would I still be OK to live in the house?

    Would there be any immediate tax consequences of gifting him...
    18-03-2020, 15:29 PM
  • SA105 Property Expenses
    by Pejayef
    Our tenants reported a leaking roof back in January which didn't actually recur again after the initial report, they moved out in February and while we were freshening up the house for the new tenants we had the roof inspected, and decided that rather than pay out for a patch job that we would replace...
    07-04-2020, 10:47 AM
  • Reply to SA105 Property Expenses
    by jpkeates
    It's still an operating cost and still allowable.
    A very cautious person might allocate some of the cost as a capital item, but I wouldn't.

    Allowable costs are any costs incurred solely and exclusively for the business.
    Then you allocate them as either operational (allowed against...
    07-04-2020, 11:24 AM
  • Reply to SA105 Property Expenses
    by Pejayef
    Hi jpkeates, I understood that a repair could be counted, but we chose to replace the whole roof, rather than go for just a repair...
    07-04-2020, 11:15 AM
  • Reply to SA105 Property Expenses
    by jpkeates
    Why do you think the roof repair can't be claimed against tax?
    07-04-2020, 10:49 AM
  • Reply to Implications of Gifting a % of Property
    by Gordon999
    The IHT tax rate of 40% tax rate is currently charged on the estate value exceeding £325K ( first £325K is free of IHT tax ) . The £325K starting level for IHT tax may be raised to £500K level, if the family home is left to children of the deceased person.
    07-04-2020, 08:54 AM
  • Rent aroom property relief.
    by calista
    Hi Qick Q i cant find the answer online..

    Can i claim rent a room relief on a rent of 300pounds a month at my first property where I live. 3600 a year.

    I rent a second property 1200 pcm, where I do not live and would not claim the rent a room relief- or rather i pay tax normally...
    31-03-2020, 12:10 PM
  • Reply to Rent aroom property relief.
    by Gordon999
    The rent-a-room scheme (rent below £7500 ) applies to a room in your own home.
    06-04-2020, 19:50 PM