Main residence for CGT and rented property

Main residence for CGT and rented property

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Hi

I would like others thoughts on an issue I have.

Property owned for 22 years and recently sold.

Basically lived in for 2 years at purchase = MAIN RESIDENCE RELIEF

Went overseas to work for 2 years and let property.  In rented accomodation overseas.  MAIN RESIDENCE?

Lived in for 3 years - MAIN RESIDENCE

Then overseas again and let for a year.

Returned to UK and lived elsewhere leaving property as let.

I believe the private residence relief is:

First 2 years PLUS 3 years lived in after returned to UK PLUS final 36 months.

No relief on the 1 year overseas as the property was not main residence after the period of absence.

But what about the 2 years in between marked ?

As lived in the property before and after it appears to be a period of absence and receive relief.  However HMRC at CG65047 effectively state if you have another residence (even if this is rented) the absence will not qualify for relief unless an election is made.  No election made although ESC D21 suggests I might eb able to do a late election?

Going round in circles at the moment!

Anyone seen HMRC query this type of scenario and I should do an election? Or do I make a claim for the 2 years overseas on the basis in practice HMRC are fine with such claims?  I am concerned that if I make an election and HMRC refuse they will pick up the issue as obviously i need to get TR filed by end of the month.

Any assistance or thoughts on this appreciated.

Thanks.

(I need to go home really...)

Replies (2)

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By johngroganjga
09th Jan 2014 21:59

You seem to be forgetting about lettings relief.

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By Mister E
10th Jan 2014 08:09

lettings relief considered

Ah yes I should have mentioned.

The gain is big enough that even after the £40k letting relief and Main Residence relief so far worked out on the 2 + 3 + 36mnths period there is a £50k gain.

So the 2 years I am unsure of will reduce a taxable gain.

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