Anyone able to work out the CGT?

caleb2003

Hello, please help.

I have 3 properties,

Property 1 I lived in for 2 years and have rented for 8 years, now accepted offer making £35k profit.

Property 2 I lived in for 5 years and have rented for 18 months, now on sale for approx £60k profit

Property 3 Current Main residence for 18 months, Going to be selling soon


As I have sold Property 1 and am selling property 2 I always presumed I would use property 2 as my Main residence exemption.

If this is correct then what would be my tax liability on each profit?

If anyone is able to quickly work it out or offer advice where to look I'd be very grateful.

Cheers

silvercar

remember that you can allow for estate agents fees, legal fees and stamp duty when calculating profit.

property 1. 10 years ownership. lived in 2 years + 3 years (as you once lived in it) gain reduced by (2+3)/10 = 50%. owned for 10 years so tapering relief leaves 60% chargable. profit of 35k x 50% x 60% = 10.5k

property 2. 6.5 years ownership. lived in 5 years + 3 years, so gain totally tax free.

property 3. All principal private residence so no tax.

Total chargable gain is 10.5k less 8.8k capital gains tax allowance = 1.7k taxed at 10% for non tax payer, 20% for basic rate tax payer, 40% for higher rate tax payer.

If the property is owned in joint names you get an allowance of 8.8k each.

There is also something called letting relief if you let a home you once lived in. I'm not sure how that works but it may reduce the tax to nil!

caleb2003

Wow!! brilliant reply, thanks a lot.

Just one thing,, I was under the impression that you could only claim Main residence allowance on one property but your indicating its possible on both property 1 and 2??

Ta