Thanks for your question - I am Sam and I am one of the UK tax experts here on Just Answer.
I am afraid capital gains will arise as you are disposing of a share you hold in a property that you advise has never been your main residence, the fact you are renting yourself and hold no other property has no bearing I am sorry to say. If the property had been empty for the ownership period (not rented out) then you could have made an election for it to be treated as your main residence, but this would had to have been made within 2 years of acquiring said property. so this would be of no use to you at this time.
The rate can be just 18%, just 28% or a mix of both, If you are a higher rate taxpayer (annual income in excess of £41785) then the gain after the annual exemption allowance and costs and major improvement would all at 28%
If your annual income is less than £41785, then the amount of any unused basic rate band can be used to allow the equivalent of the gain at 18% and any remianing gain at 28%.
And just for information non doms do have to pay tax pre 05/04/2015 if they sold and spent less than 5 years out of the UK,in which case had a tax liability to declare in their country of residence and since 06/04/2015 will ALL be liable to capital gains on any sale of property in the UK - But either way everyone pays tax somewhere where - contrary to the belief that UK exemption means worldwide exemption - as it does not!
So I hope that eases matters for you a little as I can appreciate your frustration were that to be the case.
Let me know if I can be of any further assistance with your question.
I was told that if you had made "losses" in the relevant tax year you could offset these losses agains the cap gains tax. If rent can't be considered a loss, what could be considered a loss? Also how does HMRC work out what has to be paid at 18% and what is paid at the mind-boggling 28%? Thank you.
Based on what you say about how the 18% and 28% is calculated, then if you are in receipt of Job Seekers Allowance for the relevant tax year, then presumably all of the cap gains would be at the 18% rate then....? The amount of the gain is likely to be about £80,000 in this case.
The total gain for each of the part owners is likely to be £80,000, so I will work on your first calculation. I presume when we get down to the wire after the sale that HMRC will tell us what to pay, rather than us having to work it out.
I will certainly do your rating to make sure you get your credit. Thank you