Capital Gains Tax

Capital Gains Tax

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I would like to sell my only property which I owned since 2003 in London, but has been rented out since 2005 up to May 2014, and I was living and renting in another city. The rental income has been declared accordingly. the purchase cost was £280000 and the likely sale will be around £580000. Am I liable for CGT tax in this case? as far as I know the main residence is 100% CGT exempt. Would be much appreciated if someone gives me a clear view on this. Many thanks for your answers.

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By WongR
22nd Jul 2014 17:54

CGT to pay

I would say yes - except for the proportion where you lived in the property and the last 18 months of ownership which qualifies for Private Residence Relief.

 

Please remember you can also qualify for Private Letting Relief.  (I have done no calcs but there is a maximum of £40k by my recollection)

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By Paul D Utherone
22nd Jul 2014 18:04

Yes you will be liable to CGT

I presume that you lived in it as your only residence between 2003 & 2005. That being so you will have:

the proportion of the gain for the months you lived in it + 18 / total period of ownership exempt, plusletting relief of £40k

If for example you lived in it 24 months and owned it for 132 you have

Gross gain [580K - 280k] = 300,000

Exempt as Main residence [300k x (24+18)/132] = (95,455)

Lettinf relief (Max) = (40,000)

Net gain chargeable subject to Annual Exemption £164,545

If you never lived in it then potentially the chargeable gain before annual exemption is £300k

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Replying to Maslins:
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By bivoliur
22nd Jul 2014 19:17

capital gains

Many thanks for your answers, this was very helpful, Regards

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By paras007
23rd Jul 2014 10:21

What is your residence status

Are you resident in the UK?

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By bivoliur
23rd Jul 2014 11:03

yes i am british

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By bivoliur
23rd Jul 2014 11:03

uk resident

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