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Sale of my rented house - new PRR & LR rules
icypear
Posts: 21 Forumite
I am considering selling my house (I only own this house) but not sure when to do so due to the new proposed changes to private residence relief and lettings relief. The capital gain would be approx £45,000.
I purchased and lived in my house for 6 months before having to move away and letting it out for 30 months (total 36 months ownership), which brings us to the current day.
Can anyone please clarify if I have calculated this correctly:
Currently:
6 months actual occupation + 18 months deemed occupation = 24/36 x £45000 = £30000 PRR
Lettings relief = £40000
£45000 capital gain - £30000 PRR - £40000 LR = £0 capital gains tax
After 5 April 2020
6 months actual occupation + 9 months deemed occupation = 15/36 x £45000 = £18750 PRR
Lettings relief = £0
£45000 capital gain - £18750 PRR - £0 LR = £26250 taxable gain
£26250 x 20% basic rate tax = £5250 capital gains tax to pay
Is the above correct? If so it seems pretty unfair, as only owning 1 property and having to move due to relationship reasons, im renting myself. I would have thought this sort of system would only apply to people who own more than 1 home.
I purchased and lived in my house for 6 months before having to move away and letting it out for 30 months (total 36 months ownership), which brings us to the current day.
Can anyone please clarify if I have calculated this correctly:
Currently:
6 months actual occupation + 18 months deemed occupation = 24/36 x £45000 = £30000 PRR
Lettings relief = £40000
£45000 capital gain - £30000 PRR - £40000 LR = £0 capital gains tax
After 5 April 2020
6 months actual occupation + 9 months deemed occupation = 15/36 x £45000 = £18750 PRR
Lettings relief = £0
£45000 capital gain - £18750 PRR - £0 LR = £26250 taxable gain
£26250 x 20% basic rate tax = £5250 capital gains tax to pay
Is the above correct? If so it seems pretty unfair, as only owning 1 property and having to move due to relationship reasons, im renting myself. I would have thought this sort of system would only apply to people who own more than 1 home.
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