capital gain

JustForThisOne

I have been renting out my property for nearly 3 years
For very personal reasons I had to move out and rent somewhere else
I will want to sell eventually to buy myself a home and I am very concerned about capital gain tax
Can anyone explain in plain english how capital gain is calculated?
How long would I have to be living at the property again in order to avoid it?
Can anyone help me to calculate if it is still reasonable to rent it out and pay tax rather than having to go back and live there myself?
Hope it makes sense
TIA

silvercar

You are exempt from CGT for the time it was your principal resident and the last 3 years of ownership. You also get letting relief and you have a personal CGT allowance of £10,100 if not used elsewhere.

Letting relief can be worth up to £40k, so I would say you have probably a few more years to rent it out before you have to worry about CGT. Post some figures:

purchase price;
date of purchase;
date you moved out;
potential value and date when you would want to sell

and we can do a calculation.

JustForThisOne

thank you silver much appreciated

purchase price; 155.000
date of purchase; january 2002
date you moved out; july 2008
potential value and date when you would want to sell
275.000 / 2012

JustForThisOne

pls note i will be selling second home (while renting) only very close to buying new property

silvercar

JustForThisOne wrote: »

thank you silver much appreciated

purchase price; 155.000
date of purchase; january 2002
date you moved out; july 2008
potential value and date when you would want to sell
275.000 / 2012

gain = 275-155=120.

total ownership = approx 10 years, main residence = 6.5 + last 3 yrs =9
.5

so 9.5/10 of 120 = 114 would be exempt leaving 6k chargeable to CGT which is within your CGT allowance.

JustForThisOne

thanx you very much