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Capital gains tax on selling property
Comments
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you have forgotten that letting relief is also availableAssuming that you are a basic rate tax payer. You first need to calculate the gain.
So based on your figures £105K - £80K = £25K. You can also discount a chunk of the gain for when you lived in the property plus an additional period of time. This is all done by the month so use the calculator. But....Even if you only were able to knock off 50% of the gain, this would reduce it down to £12.5K. You would also be able to take off your selling costs which will probably be £1K-£2K. So I suspect that you will have a gain that is below the annual CGT exemption that is £11,300 this year. So no tax to pay. But you would need to work out the numbers properly yourself.
Also (and I've not needed to look into this in detail), you may well pay far more in stamp duty on your new house if you don't sell the flat (3% extra I think).
with only a 25k gain and 50% PRR and LR being available, plus the personal allowance, it would be impossible for there to be a net taxable gain as shown in the example calculation linked at #4 already mentioned by Pixie0 -
To be honest I hadn't considered stamp on the next property only because we haven't looked yet, I was more worried about what I would have to pay on this which given the calculation is nothing so that's a comfort to know, so it would make sense to sell now, now depends on whether it will actually sell !
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have you actually done the calculation yet?To be honest I hadn't considered stamp on the next property only because we haven't looked yet, I was more worried about what I would have to pay on this which given the calculation is nothing so that's a comfort to know, so it would make sense to sell now, now depends on whether it will actually sell !
Simply taking my comment at face value will not help you complete your tax return. And yes, despite probably no tax, you will need to complete the CGT pages of your tax return for the year in which you do sell because the rule is where you are already required to notify tax (you have rental income) you must declare your CGT, even if zero to pay. So you need to understand the calculation!0
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