Primary residence previously BTL

56cheffy

I bought a house in 2007 which was rented out until May 2016, I then moved in and it became my primary residence.

If I sell am I liable for CGT?

Thanks

00ec25

YES

put your numbers through here to find out how much:
https://forums.moneysavingexpert.com/showpost.php?p=73621764&postcount=2

saajan_12

56cheffy wrote: »

I bought a house in 2007 which was rented out until May 2016, I then moved in and it became my primary residence.

If I sell am I liable for CGT?

Thanks

Yes, start with the gain in house value between value at purchase and sale, less buying/selling costs. Then you get specific allowances / reductions:
1) PPR for the proportion of time it was your primary residence out of the total time you owned it. You're assumed to have lived there for the last 18 months if you did previously, so make sure to include that but not double count it. Roughly 2 years / 11 years = 18% but the calc must be in months.

2) Lettings relief for the proportion of time it was let, capped at the lower of the PPR and 40k. Roughly min(9years / 11 years , 18% , 40k) = min (18%, 40k) as clearly 9 years/11years = 81% is higher than 18% so you go with the lower value.

3) Annual allowance 11.7k this year, assuming you haven't made any other capital gains (ie sold any investments) this tax year.

So your taxable gain is Sale - Purchase - Costs - PPR - LR - AA. On this you pay tax at 18% for the proportion under the higher rate threshold (once combined with your other income) and 28% on the proportion above the threshold.

SmashedAvacado

What was the price of the property when you bought
What were the lawyers and surveyors fees when you bought
What are the selling agents fees
What are the selling lawyers fees
What is the actual profit
Within that profit has there been any capital expenditure capable of deduction?
Have you still made a profit
Do the calculation above based on that profit - as this is your capital gain
Does that profit come above your CGT allowance
If so you have to pay some CGT