Capital gains tax on temporary second home?

patchyX2

Scenario:
- I own and live in 1 house
- I see a house that I'd like to buy
- I haven't yet sold mine, but don't want to lose out, so pay for house #2 in cash
- Purchase for house #2 completes
- I manage to sell house #1 several months later

Would I be liable for paying capital gains tax on this last bullet point, since it's technically a second home I'm selling? If so, how would it be calculated?

I know there's a higher rate of stamp duty on a second home, but you can claim that back if you sell within ~3 years I believe. Is there an equivalent for CGT?

p00hsticks

There's an additional 9 months leeway added on to the CGT calculation for those who are selling what has been their principal residence, so if you sell within 9 months of buying the second one you'll be fine. 

[Deleted User]

Even if the first house is not sold within, say, a year it is likely that no CGT is payable as you will be able to avail of Private Residence Relief. How much depends on period of ownership. 

Jeremy535897

If house 2 is not habitable there are other reliefs available, but I assume this does not apply.
You can only have one main residence at a time, so if you will sell house 1 within 9 months of moving into house 2, make sure you nominate house 2 as your main residence.
This is a very useful guide:
https://www.gov.uk/government/publications/private-residence-relief-hs283-self-assessment-helpsheet/hs283-private-residence-relief-2024

patchyX2

Yes the house will be habitable (although I might choose not to live there for a few weeks while we get it straight). 

House sale should go through within 9 months, so hopefully CGT shouldn't be a problem. 

Thanks all!