Tax on selling a second building

kaybee_2

Hello All,
We have recently purchased a victorian house which we are very pleased with but it is just a stepping stone and we would like to move in around two years time to a house with a better garden.

My fiance has another small unit which is his business.

We have been thinking that we should put the house in just my name so that when we come to sell the house we do not have to pay the high tax as we have two properties (one home & and one business premises)

A plasterer whom is doing a bedroom in our house mentioned yesterday that 'we should move within two years as if you have two properties and you sell your house within two years you will not have to pay the high tax'
I have never heard of this before and I am wondering has he got mixed up with something else or is this true? If it is true then it would be much more worthwhile for me and my fiance to aim to sell within two years rather than get my fiances name off the title of the house.

Does anyone have any advise?
Thank you

sneekymum

Yes - he got mixed up there - never take financial advice from plasterers.

Boyfriend's property will but subject to generous relief as a business asset if he ever sell it - assuming its a genuine business property and not a house/flat. Your main residence is always free from CGT.

kaybee_2

Thanks Sneeky mum, does that mean as one building is a home and we will be selling that one to move onto another one we will not get charged tax as that is the main residence? The other building is used as a business unit for a sole trader.

sneekymum

That's right. You only need to worry about CGT if you get another house/flat (holiday house or buy to let) - if you sell the business unit there'll be very little tax to pay (remember you've got a CGT allowance of £8,200 this year) or I believe there could be no tax to pay if the sale is reinvested in more business property - businesses are allowed to move premises).

It would be worth putting the business unit in joint names as any eventual taxable sale will benefit from double annual allowance. And keep all records and receipts of money spent on this business unit as original purchase price, stamp duty, solicitors's fees are deducatable eventually - as are many other things but I won't go into that here...

I should tell you that I'm no expert and have no financial qualifications whatsoever - I'm just very interested in tax... why do people travel across town to save a fiver when there's thousands to be saved by reading the Pure Money boards. You don't know what you don't know...