Capital Gains Tax for Armed Forces

arfajob

Hi,
I am about to sell a property I have owned for 20 yrs. I have lived in it for 8yrs and let it for 12yrs. This is my only property and have let it due to being in the Armed Forces and being on the move all over the country. Can anyone help with the rules on Capital Gains Tax.
Would I have to pay this tax if I sold the property straight after the tenant moves out, or would I have to live in it for a period, before selling to avoid the tax?
Thanks, would appreciate any help on this matter as I seem to get different answers back!! :rotfl:

Alias_Omega

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silvercar

Would be better moved to the tax board!

Jowo_2

http://www.hmrc.gov.uk/cgt/property/index.htm

This includes a calculator.

http://www.direct.gov.uk/en/MoneyTaxAndBenefits/Taxes/TaxOnPropertyAndRentalIncome/DG_4020890

On the above link they discuss Private Residence Relief which is perhaps what you are referring to which indicates that you can still qualify for the full amount of Private Residence Relief, provided that ...."the property has been your main home from the time that you bought it ... you sell it within three years of moving out or it no longer being your main home."

I believe HMRC always look at the last 3 years of ownership when determining relief so if its let out in that last period, no relief is due. However, the following fact sheet lists exemptions, including when an employer provides job related accommodation elsewhere or when the job makes you work away from home.

http://www.hmrc.gov.uk/helpsheets/HS283.pdf

There is a tax forum on landlordzone which has tax experts as members.

silvercar

From here:

http://www.hmrc.gov.uk/helpsheets/HS283.pdf


"Job-related accommodation
If you live in accommodation that is job-related and you also own a
dwelling house that you intend to occupy as your only or main residence,
the dwelling house you intend to occupy is treated as actually being
occupied by you as a residence during the period in which you intend to
occupy it, even if you never actually live there. This means that you may
nominate that residence as your only or main residence and get relief on the
whole or a part of the gain. Please see the paragraph headed ‘Only or main
residence’ on page 3. If your intention to live in the dwelling house ends,
then the dwelling house is no longer treated as your residence.
Accommodation is job-related if it is exempt from Income Tax for the
reasons set out in Helpsheet 202 Living accommodation."

Looks like it is the intention to live in it that counts, not whether you actually lived in it. So evicting the tenant because you want the property as your home would be more convincing than evicting for sale.

arfajob

Thanks for the advice, I appreciate the help.
This is something I must look into further. Safest bet is a call to the tax office, not something you can mess up, not without the risk of a large tax bill!!

silvercar

Post on the tax board; jimmo, an ex government tax inspector specialising in CGT, will see it and give you an answer.

If you do phone the tax office, you can only rely on an answer in writing, not an opinion off the phone from some untraceable staff member.