Selling garden with planning

Postman88

I am in the process of applying for planning permission to sell part of my garden with. If successful I want to avoid losing as much as possible in tax. Its currently my main residence but we are also about to rent it which would mean paying capital gains tax. Am i exempt under PRE if I reaming living there? Is there a time limit? Or am I only chared CGT on the time I am not residing there? Also if I move out as intended how do i calculate the CGT I incur? It is joint ownership with my wife so I believe we both have a CGT exemption amount so what % is charegable? Thanks

booksurr

2 separate issues:

1. read this for the basics of CGT calculation
http://forums.moneysavingexpert.com/showpost.php?p=69071134&postcount=6

2. provided a) the entire size of the current plot (incl the house footprint) is less than 0.5 hectare AND you do NOT fence off the plot of land to be sold with pp then you still have a valid claim to PRR on the whole sale. Fail one or both of those and you will need professional help from a land surveyor to value the property and a tax accountant to deal with the resultant CGT

jimmo

booksurr wrote: »

provided a) the entire size of the current plot (incl the house footprint) is less than 0.5 hectare AND you do NOT fence off the plot of land to be sold with pp then you still have a valid claim to PRR on the whole sale. Fail one or both of those and you will need professional help from a land surveyor to value the property and a tax accountant to deal with the resultant CGT

I don’t think the situation is as clear-cut as that.
The concept of not fencing off the part of the garden to be sold derives from the Tax Case Varty vs. Lynes but the principle that was established by the case is that in order to qualify for relief the land has to be in use, as garden or grounds, at the point of sale.
http://www.hmrc.gov.uk/manuals/cgmanual/CG64377.htm
In your question here it seems to me that if you let the house (together with the remaining garden or grounds) then the land to be sold will become separate, regardless of whether it is fenced off or not. I suppose, metaphorically, the lease will be the fence.
Mr Lynes sold his house, you will let yours but, in my view, the effect is the same. You will be liable to Capital Gains Tax on the whole gain on the sale of the land.
In tax terms it is probably simplest if you can sell the land whilst still living in the house. Next best would be selling the land before letting the house.