Selling to rent - any tax due?

Mitsouko

The sale on our house is going through, and due to the media coverage of falling house prices, etc, we have decided to rent for a while before we buy again.

We will have about £80,000 equity from the house to put into savings accounts and wait until the right time to buy again.

It has just occurred to me - we won't be liable for capital gains tax or anything like that, will we?

Does anyone know?

fengirl_2

Not if the house has always been your only or main residence.

thegeneral76

As long as your house was your primary dwelling, then no CGT is due on the proceeds of the sale of that house.

Your 80k equity which will become your savings will be subject to tax on any interest accrued while you search for your next place, but that's all.

Mikeyorks

Mitsouko wrote: »

- we won't be liable for capital gains tax or anything like that, will we?

Not if it's your main residence. The only additional tax payable is likely to be on the extra interest you get by wisely tucking the £80k into a good rate savings account? (Or, better still, by tucking it into a couple of accounts in order to get total cover {£35k per institution .. up to £70k if joint account} in the unlikely event one of the financial bodies, regulated by the FSA, runs into difficulties)