Capital Gains Tax

stoke_bishop

If I move away at some point in the future, living in a different country for a while and in the meantime renting out my UK house, how long do I have to live back in my house again before I am not liable to Capital Gains Tax.
I know that I have three (?) years grace anyway.

Thanks...

fengirl_2

There is no time limit, HMRC will look at the quality of the occupation, but however long you occupy the house, it will not wipe out the CGT liability.
As you rightly state, the last 3 yrs of ownership are exempt, as is the period during which you live in it as your only or main residence. In addition, where you let out a property previously your only or mian residence, there is a special exemption of up to £45k for the gain on the let period. So, you need to take these periods into account, but nothing will wipe out a let period.

cash99

stoke_bishop wrote: »

If I move away at some point in the future, living in a different country for a while and in the meantime renting out my UK house, how long do I have to live back in my house again before I am not liable to Capital Gains Tax.
I know that I have three (?) years grace anyway.

Thanks...

Only the last 3 years of ownership are exempt without occupation, this is not the same as a period of grace of 3 years. i.e if you are away for 3 years then come back for 2 years and then sell only one of the 3 years away will be exempt. The proportion of the gain relating to those 2 years would be subject to CGT.

However if you let the property while you are away you may be eligile for lettings relief, which can be up to £40k.

stoke_bishop

cash99 wrote: »

Only the last 3 years of ownership are exempt without occupation, this is not the same as a period of grace of 3 years. i.e if you are away for 3 years then come back for 2 years and then sell only one of the 3 years away will be exempt. The proportion of the gain relating to those 2 years would be subject to CGT.

However if you let the property while you are away you may be eligile for lettings relief, which can be up to £40k.

Looks like this the answer. Thanks for your help.

Working abroad

If you have been working abroad you will normally be treated as though you have lived in the UK property, and so qualify for private residence relief, provided that both of the following apply to you:

• you live in the property both before and after your absence
• you have no other home which qualifies for private residence relief

This relief also applies when it is your husband, wife or civil partner who was working abroad.
You will still get private residence relief for your time abroad, even if you do not return to live in the UK house, provided that the only reason you do not come back to live in your former home is that the employer requires you (or your husband, wife or civil partner) to work elsewhere.

GARDINER

http://www.hmrc.gov.uk/manuals/cg4manual/CG64985.htm

I think this is the answer to the 36 months rule.