Will i have to pay capital gains tax?

paul67kestrel

I have been renting a property out now for 2 1/2 years. And i am selling it. Will i have to pay any capital gains on the property.

I bought the property 10 years and lived in it for 7 1/2 years before purchasing another property.

Thanks
Paul

silvercar

you should be OK provided you sell it within 3 years of renting it out.

failing that you will only pay CGT based on the proportion of time that it wasn't your principal private residence or the last three years of ownership. if you lived in it for 7 1/2 years and sold it 3 1/2 years later you would only pay 1/2 divide by 11 of the gain ie 1/22. you also have a CGT allowance of £8,800 (this year), so there is probaby little to worry about.

sparkle_berry

If you lived in the property at some point you also get £40k letting relief which reduces your capital gain.

Susie

WHA

There is unlikely to be capital gains tax due, but you do have to notify HM Revenue & Customs of the sale and they may well want you to complete a self assessment tax return with supporting computations showing how the gain is covered by exemptions etc. This is because it is no longer your home, and the exemption from notification is selling your home!

Cyee

The above info has been really helpful. I'm in a slightly different situation and was wondering if anyone has any advice/suggestions for me.

I owned a property for just under 3 years. It is the only property I have owned until I bought another after selling this one (I've never owned 2 at the same time). I bought it because my mother passed away and for a while I thought I might need to relocate back to N.Ireland to support my dad. I spent a few months living there pretty much all the time - working from home but scooting over and back to London where my employer was based. To help with costs I rented a couple of rooms out for pretty much the duration of my ownership. I have declared and paid tax on that rent, and didn't make any money out of it (in fact lost money due to the tax!), as I have a repayment, and not a buy to let mortgage.

That's the backstory, but basically I now don't know where I stand on capital gains. I have read extensively around the topic and there's the 36 months issue - but as I owned the house for less than 36 months I don't know if/how that will apply to me.

If anyone has any experience/advice on if/how much CGT I will owe on this, I'd be grateful. Also - I'm not sure how I'd prove I'd lived here as I got a lot of post sent to my boyfriend's rented place and was not on the electoral register.

Thanks in advance.

Toni_Tax

Cyee, I would say thats your principal private residence as it's the only property you own, so therefore no CGT payable

liverpool_lill

Hi does anyone know if i have to pay capital gains tax if i sell the garden at the side of my house as a building plot?