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I'm still not clear on the first point. so if I sell my flat I will get capital gains tax as over 18 months? If I bought for 187,500 and it is now worth 500k how much would this be. In total I have spent 15k in enhancements. New Kitchen, Bathroom etc. thanks
Cost price 202,500
Sale price 500,000 – sale in Oct 2014
Total gain 297,500 Period of ownership 9 (108 mths) Main residence 7 years (84 mths) Last 18 months exemption (18 mths) Letting period 2 years (24 mths) Total exemption (private residence relief) = (84+18 = 102mths)=94% Taxable gain 108-102 = 6 mths/108 mths = 6% Chargeable gain 297,500 x 6% = £17,850 Letting relief = £17,850 CGT payable = NIL