Capital Gains Tax

alx3365

I will be selling a house I have owned for 16 years. For the previous four years I have let the property out to tenants and relocated to a different city where I got a great job offer and got another house on a mortgage.

My questions are:

1) How can I prove that the initial property I owned for 16 years was my primary residence for the first 12 of those years. I don't think I have much in the way of utility bills and council tax statements five years back.

2) Even though I'm not living in my property at the moment, will I still be exempt from paying CGT for those first 12 years of primary residence occupancy?

Thanks!

CLAPTON

alx3365 wrote: »

I will be selling a house I have owned for 16 years. For the previous four years I have let the property out to tenants and relocated to a different city where I got a great job offer and got another house on a mortgage.

My questions are:

1) How can I prove that the initial property I owned for 16 years was my primary residence for the first 12 of those years. I don't think I have much in the way of utility bills and council tax statements five years back.

2) Even though I'm not living in my property at the moment, will I still be exempt from paying CGT for those first 12 years of primary residence occupancy?

Thanks!

presumably you lived in the property for the first 12 years

so probably no tax is payable

but we need to know
buying price
likely selling price

kinger101

First, I recommend you post this on the tax forum, as you'll get better answers there.

But, you get reliefs as follows;

PPR relief for the period you resided in the home
Deemed PPR for the last 18 months of ownership
Letting relief;

I'll explain with an example.

You bought the house for £150K and sold for £300K (after deducting EA fee etc), leaving 150 K profit.

Total ownership period = 16y x 12m = 192 months
PPR = 12 years actual (144m) plus last 18 months = 162

PPR relief = £150K * 162/192 = £126,563
Leaving a £23,437 gain (before letting relief).

Letting relief is lower of
(a) PPR relief
(b) gain arising during letting perion
(c) £40,000

So taxable gain is reduced to nil.

I'm not sure what evidence HMRC ask for, but I'm sure if you post on tax forum, someone can help.

Maybe link to my calculations so someone else can check.

Hope this help.