Living with partner - implications When selling own house

Dot18

My partner and I each owned properties in different cities and when we moved to same city lived together in rented accommodation My partner sold his property and bought the house we currently live in - as we thought we would be there short term I lent him money to buy and he used a loan note and the deeds are in his name. When it became clear it may be a longer period of time we would be there he paid me back and (I think) paid off the loan note. I later sold my house and bought a property closer to where we live but have not lived in it as my primary residence or rented it out at all. My partner has made no contribution to it but the council has put his name on the counci tax bill. If I were to now sell the property - some 14 years on - would it be considered a second home and would I have to pay capital gains task - would this be affected by whether I was still living with my partner or not? 

Many thanks for any advice. 

sammyjammy

Your post is a bit difficult to understand, whats a loan note?  A mortgage?  Assume you aren't married?  Is your name on the council tax bill at "his" house?

_Penny_Dreadful

Dot18 said:

My partner and I each owned properties in different cities and when we moved to same city lived together in rented accommodation My partner sold his property and bought the house we currently live in - as we thought we would be there short term I lent him money to buy and he used a loan note and the deeds are in his name. When it became clear it may be a longer period of time we would be there he paid me back and (I think) paid off the loan note. I later sold my house and bought a property closer to where we live but have not lived in it as my primary residence or rented it out at all. My partner has made no contribution to it but the council has put his name on the counci tax bill. If I were to now sell the property - some 14 years on - would it be considered a second home and would I have to pay capital gains task - would this be affected by whether I was still living with my partner or not? 

Many thanks for any advice. 

What is a loan note?  Do you have a charge against your partner's property for the money you loaned them to buy it?

The property you bought 14 years ago has never been your main residence and therefore the sale will be subject to Capital Gains Tax.  Whether you're living with your partner or not is irrelevant.  It's the fact the property you want to sell has never been your only or main home that means you will not be eligible for the Private Residence Relief (PRR).

Keep_pedalling

If the property has gained in value since you purchased it then you will have a CGT liability on the gain. If you are not married or in a civil partnership then it is not a second home, but as you have never occupied it it can’t be classed as your primary residence.

dimbo61

So you bought a house ?
You pay the council tax with single person discount ?
Do you pay the Gas/Electric/Water bills and standing charges ?
Why have you not rented it out in the last 14 years ?
Where do you have your HMRC registered  address ? 
What about your employer ?
What address do you use for DVLA ? and other companies 

Dot18

Thank you for all the replies. A loan note is an agreement whereby money is borrowed at an agreed rate and payment conditions are specified - so like a mortgage - but not specifically for buying a house - there are different tax implications depending on the type but I don’t know the details of the particular loan note for the house. We are not married. I pay half the bills in the house we live in.  What defines a property as having been or becoming a main residence for tax purposes - presumably it can become a main residence if I/we move in - presumably you can’t do that just for the purpose of selling - I don’t have any charge against the property for loaning the money (should I have had?) but have since been paid back so this probably isn’t an issue though it was the exact amount loaned - there was no interest paid. 

_Penny_Dreadful

Dot18 said:

Thank you for all the replies. A loan note is an agreement whereby money is borrowed at an agreed rate and payment conditions are specified - so like a mortgage - but not specifically for buying a house - there are different tax implications depending on the type but I don’t know the details of the particular loan note for the house. We are not married. I pay half the bills in the house we live in.  What defines a property as having been or becoming a main residence for tax purposes - presumably it can become a main residence if I/we move in - presumably you can’t do that just for the purpose of selling - I don’t have any charge against the property for loaning the money (should I have had?) but have since been paid back so this probably isn’t an issue though it was the exact amount loaned - there was no interest paid. 

The definition is self-explanatory, the property has to be your only or main residence. Yes, you can move in and that could give you PPR for the period you reside in the property providing it is your main residence at the time, but that will not give you PRR for the last 14 years of ownership. 

propertyrental

The property was not your main residence for 14 years.
If you now move in, you'll be liable for CGT for the 14 years but not for current years as it will become your main residence.

Out of interest, what council tax do you pay? Most councils charge extra for empty/unoccupied properties, and certainly don't allow the single person discount if you are not living there. Depends what you've told them and what CT you are paying whether you have committed fraud or not.....

user1977

If it hasn't been your principal residence and you haven't been letting it out, what have you been using it for in the past 14 years?

Dot18

Thank you for the replies. The house was bought as an incomplete renovation so the start  of the 14 years was weekend DIY to get it to liveable status fitted around work, young children and caring for elderly relatives.   I pay the full council tax - not single person. I pay the electricity - there is no gas and it’s private water.  We still spend some time there but I have thought of trying to rent. It’s difficult to access (needs 4x4) so not sure how successful a short term let would be but maybe something I could explore rather than selling.   For all HMRC purposes/work etc the address is where I spend most time ie currently my partner