Help with CGT figures for rented property

lolaj78

Right the basics are:

House purchased in November 1999 for £58,500

Lived there until March 2006

Bought a property with my now husband and so rented 1st property out. Continued to rent it out until March 2014 (all rental income declared on yearly SA).

I sold the property in Dec 2014 for £169,500

So my gain is 169,500 - £58,500= £111,000 less say £3,500 buying and selling costs = £107,500

So total ownership in months is 181.

PPR = 76 + 18 = 94/181 × 107500 = £55,829

Remainder = 87/181 x 107500 = £55,671

Would the £40,0000 letting relief apply here? If so then gain is £15,671 - £11,000 allowance = £4671 @ 18% = £841.

Is this correct?

booksurr

your application of the rules is correct but your maths is wrong

gross gain 107,500 - PRR - LR(capped at lowest value of 40k) - PA
107,500 - 55,829 - 40,000 - 11,000 = 671 taxable gain

lolaj78

Oops yep used the wrong figure :-)

So I can still use the Letting Relief even though I bought a new house with my husband?

booksurr

lolaj78 wrote: »

So I can still use the Letting Relief even though I bought a new house with my husband?

to qualify for LR the property has, at some point in your ownership, to be your PPR

on the info you present your marriage occurred after you first owned the property and after you first started living there as its owner whilst using it as your main residence at that time.

Therefore, the fact you subsequently own another property with husband is irrelevant. The PPR marital home may well be elsewhere now, but your claim to PPR on the old one remains and does not overlap with the marital PPR since you state you moved out in March 2006 at which point the letting commenced and the marriage took place

lolaj78

Thanks so much, that is a huge relief to me as I was worried that I wouldn't be able to claim LR.
Thanks again :-)