CGT on house sale that was PPR

CGT on house sale that was PPR

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Client owns a house which was his PPR for 3 years to December 2005. The property was subsequently rented out.

The property is for sale and the gain will be c. £68k.

If the property is sold before December 2008 will be gain be zero?

If it is sold in January will it be a case of prorata the gain 36/73th of the total period of ownership?

Thanks
Linda

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By User deleted
04th Sep 2008 10:40

Occupation plus final 36 months of ownership
The whole of the gain is likely to be exempt on this sale as the total period of ownership to Jan 2008 is only 73 Months.

Exempt proportion will be:
Actual Occupation 36 months plus final 36 months of ownership (for any reason). Therefore, only one month is a chargeable period. which is covered by CGT annual exemption or if needed a claim for lettings relief.

Even if the period of ownership runs longer then the extra months could still be covered by the lettings relief claim.

Calculation of lettings relief available is the lowest of:
1) Any gain relating to the letting period
2) £40,000 (which is the maximum relief available)
3) the gain already exempt under PPR (i.e occupied plus final 36 mths)

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By User deleted
03rd Sep 2008 23:15

Yep
36 months after he left will be exempt IR283. However after that if the rental profit/loss was declared then letting relief will kick in and most probably cancel any gain but these thing are calculated against absolute dates. Personal CG Allowance and deductible acquisition and sales and legal fees will wipe any gain out. If you need further help then ask. Regards Peter

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