Property sale overlap... CGT?

starrystarry

Hope someone can answer a CGT question for me.

We currently live in property A, which we're in the process of selling. We're also in the process of buying property B which will be our new home. It's likely we'll complete on the purchase of B before the sale of A completes. Don't need the funds from A in order to buy B. Also likely we'll move to B before sale of A completed. 

So for a brief period (few weeks) we'll own both properties at the same time. Are there any CGT implications? I've tried googling this but not had much luck. All I could find was a reference to informing HMRC which is our primary residence. Any advice welcomed. 

p00hsticks

There won't be any CGT implications - the last nine months before you sell are exempt, whether you are still living there or not. What will affect you (assuming you;re in England) is the additional SDLT, which you'll have to pay when you purchase B, but shoudl be able to claim back once you've sold A.

starrystarry

Thanks @p00hsticks, that's really helpful. I was aware of the extra SDLT we'll have to pay then claim back. Just wanted to make sure I wasn't overlooking a CGT issue as well. 

Jeremy535897

Full details here:

https://www.gov.uk/government/publications/private-residence-relief-hs283-self-assessment-helpsheet/hs283-private-residence-relief-2021

If you live in both homes for a period, consider whether to nominate your new home as your main residence from when you buy it. You can do this within 2 years of buying it, so by then you should know when you sold the old home (and if that is within 9 months of buying the new home).

starrystarry

Thanks @Jeremy535897.  What is the advantage of nominating the new house as main residence? 

Jeremy535897

If you don't there could possibly be a period at the beginning of your ownership that doesn't qualify for relief when you eventually come to sell it.

starrystarry

OK, thank you. 

nyermen

Also consider council tax - which property is being inhabited, some councils allow zero CT for a short period if "unfurnished" (for example), others smack you with 200%...

starrystarry

Thanks @nyermen. Property B will be inhabited, property A will be unfurnished.  I'll check with the council re the council tax situation.