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capital gains tax
rexel
Posts: 602 Forumite
I bought a house 8 years ago with a buy to let mortage house cost £60000 it is now worth £90000 will i have to pay capital gains tax if i sell durning that time it was rented out
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Comments
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Was it rented out for the whole period?
Yes you will have CGT to pay on the gain (less your annual exempt allowance)A smile enriches those who receive without making poorer those who giveor "It costs nowt to be nice"0 -
i can start to live in it now Tennants have left0
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The inland revenue are wise to people moving in as they sell. You would really need to live in it for a few months before putting it up for sale.
As it stands your CGT calculation would be a gain of 30k less buying and selling costs less your CGT allowance of £10,600 if not used elsewhere. The gain is taxed at 18% or 28% depending on your tax liability.I'm a Forum Ambassador on the housing, mortgages & student money saving boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Forum Ambassadors are not moderators and don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com (it's not part of my role to deal with this). Any views are mine and not the official line of MoneySavingExpert.com.0 -
when i bought the house it was in my name Since i am now married would it help if i put house in joint names0
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The inland revenue are wise to people moving in as they sell. You would really need to live in it for a few months before putting it up for sale.
As it stands your CGT calculation would be a gain of 30k less buying and selling costs less your CGT allowance of £10,600 if not used elsewhere. The gain is taxed at 18% or 28% depending on your tax liability.
sorry to hijack - can't you also offset any money spent on the property i.e. building work, Lease extensions etc ?0 -
when i bought the house it was in my name Since i am now married would it help if i put house in joint names
yes as then both you and your OH would have annual exemptions - so by the time buying and selling costs and the like are taken into account you'll have a very limited liability, certainly not worth the hassle of moving in for0 -
when i bought the house it was in my name Since i am now married would it help if i put house in joint names
yes - the gain wil be split in accordance with the respective ownership shares and each of you will get your personal allaownance against your own gain
however, be aware that any transfer must be done well in advance of selling the property - if for example you are already marketing the property for sale it may be too late to do a transfer as HMRC have the power to set aside transfers between spouses where (in their opinion) the only reason for doing it is to reduce a tax bill. I have never seen a link to HMRC website supporting this, but there are posts on web forums recording HMRC doing this to real people, eg: curtesy of a post by ceeforcat read this re pre-sale transfers.
http://www.taxexpert.co.uk/property_...t_property.phpsorry to hijack - can't you also offset any money spent on the property i.e. building work, Lease extensions etc ?
yes - but only if the expenditire is truely of a capital (ie impriovements) rather than revenue (ie repairs) nature0
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