How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask TonyTax Your Own Question
TonyTax
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15940
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
13905389
Type Your Tax Question Here...
TonyTax is online now

I bought a flat in 2009 , I was planning to live in it , but

Customer Question

I bought a flat in 2009 , I was planning to live in it , but rented it out without ever living in it , and am still renting it out now , one of my neighbours recently sold her flat for 170 ,000, if I were to sell mine now for the same amount , how much would I have in capital gains tax
Submitted: 2 years ago.
Category: Tax
Expert:  TonyTax replied 2 years ago.
Hi.

Can you tell me what you paid for the flat please.
Customer: replied 2 years ago.

hello , I paid 112 ,000 pounds , thanks

Expert:  TonyTax replied 2 years ago.
Thanks.

Leave this with me while I draft my answer.
Expert:  TonyTax replied 2 years ago.

Hi again.

If you sell the property for £170,000 having paid £112,000 for it, you will make a gain of £58,000. The first £11,100 of the gain will be exempt from CGT which leaves a net taxable gain of £46,900. You can also deduct the costs of purchase and sale (legal fees, survey fees, stamp duty, selling agent fees, disbursements, VAT) from the disposal proceeds.

There are two rates of CGT, 18% and 28%. The rate or combination of rates that you will pay will be dependent on the level of your income in the tax year of disposal of the flat. Assuming you sell the flat in the 2015/16 tax year, one of the following scenarios will apply:

1 If your income in 2015/16 including the net taxable gain is £42,385 or less, then all the net taxable gain will be taxed at 18%.

2 If your income in 2015/16 excluding the net taxable gain is £42,385 or more, then all the net taxable gain will be taxed at 28%.

3 If your income in 2015/16 excluding the net taxable gain is less than £42,385 but more than £42,385 when you include the net taxable gain then part of it will be taxed at 18% and part at 28%.

I hope this helps but let me know if you have any further questions.