If my house purchase completes and I then sell my flat will I get hit with capital gains tax?

Jolysium

Help please! Had a couple of different answers to my question already. Even if you can just advise who I need to speak to for a definitive answer it would be much appreciated.

Basically, I own a flat that I have lived in for the whole time I've owned it. I'm now trying to buy a house with my partner. The housing market is absolutely crazy where I am currently so I would ideally like to buy the house and then sell the flat afterwards. I've managed to work out that if I do this, I will be able to reclaim the extra stamp duty I'll have to pay on the house purchase as long as I sell within three years. However, someone said I'll have to pay capital gains tax on the flat sale if it doesn't all go through the same day. Is this true or would I qualify for private residence relief? Are there other hidden sneaky ways people will take my money if I don't put myself through the awful process of buying and selling in one go?

Any wisdom appreciated! Thank you :-) 

MaryNB

From gov.uk

The final 9 months of your period of ownership always qualify for relief, regardless of how you use the property in that time, as long as the dwelling house has been your only or main residence at some point.

dimbo61

No you don't pay capital gains tax unless you plan to rent it out ? 
So you and your partner buy a new property you will have to pay the 3% extra stamp duty on the purchase price.
Once you sell your flat ( within 3 years ) you can claim it back.
It you rent out the flat for a couple of years then you might end up paying Capital gains tax and lose out on getting the 3% stamp duty back

Jolysium

Thank you both very much, I really should have started with this forum rather than getting all confused by family members!

p00hsticks

dimbo61 said:

No you don't pay capital gains tax unless you plan to rent it out ? 

As far as I'm aware for CGT purposes it's not relevant what you do with the property after it ceases to become your principal residence (PPR) that it's important, it's how long you keep it.

As MaryNB has pointed out, you have up to nine months after you move out for PPR relief to still apply.

After that nine months, whether you decide to rent it out or to leave it empty, potentially CGT would apply - but unless house prices are absolutely soaring if it's been your PPR for any length of time it's unlikely that there'll be much of a CGT liability accruing for a good few years....

dimbo61

The poster will have a capital gains tax allowance of £11,500 so that plus the PPPR  of 9 months would hopefully mean Zero CGT to pay.

pumas

cgt allowance this year- £12,300

dimbo61

Sorry I stand corrected 😂