Capital Gains Tax question

jimmo

Property sold 12/1/06 £230,000
Property purchased 8/96 £78,000
Capital Gain £152,000
Period of ownership 113 months
Period of occupation 69 months
last 3 years of ownership 36 months
Total exempt period 105 months
Exempt gain (105/113) £141,238.94
Remaining gain £10,761.06
As the remaining gain is less than £40,000 you will be covered by lettings relief and nothing is chargeable.

Buggins

Hi Jimmo - Thanks so much for your prompt response last night - you stay up late don't you????
I'm going to show my ignorance again and say that I don't understand "Letting relief", I've had a quick look at HMRC website and that didn't help - most of it seemed to relate to holiday lettings and this does not come into that category. Are you able to explain in lay man's language. I am sorry to be so naive in this matter but your help is really gratefully received.
Buggins.

silvercar

Lettings relief is another relief that you can claim to reduce your CGT bill, nothing to do with holiday lettings which fall under a completely different set of rules.

With apologies for the use of non- tax man language:

You can claim lettings relief if you let a property that was (either before or after the letting) your principal private residence.
lettings relief is restricted to the lower of:
a) £40,000
b) the amount of PPR relief that you would have got had it been your PPR at the time it was let.
c) the amount of PPR you did have.