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taxadvisor.uk, Chartered Certified Accountant
Category: Tax
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Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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We bought our property in November 2001 on a 50% shared

Resolved Question:

Hi,
We bought our property in November 2001 on a 50% shared ownership basis of 130,000 GBP (our mortgage being 65’000 and paying rent on the remainder)
In Jan 2009 we bought the outstanding 50% share, which was valued at 107,500 GBP. (total property valuation 215'000) taking out an additional mortgage of 120’000 GBP), moved abroad and rented it out on a buy-to-let basis.
We have just had it valued at 325’000 GBP and are putting it on the market.
We have both been non-resident in the UK since March 2009.
How do we work out the CGT as we only owned 50% for the first 8 years?
Many thanks,
Sue
Submitted: 2 years ago.
Category: Tax
Expert:  taxadvisor.uk replied 2 years ago.
Hello and welcome to the site. Thank you for your question.

Please clarify
Are you likely to return to the UK in the near future to live?

Many thanks
Customer: replied 2 years ago.

No, we have no plans to return in the near future.. it's too cold!

Expert:  taxadvisor.uk replied 2 years ago.

Sue, thank you for your reply.

There have been changes to CGT on residential properties owned by non residents that came into effect on 6 Apr 2015.

Basically, CGT would be payable on gain but you would use the valuation at 5 Apr 2015 as your base price. In other words, your chargeable gain will be the difference between the value of the property at 5 Apr 2015 and the sales proceeds.

In your case,the base cost would be approx £325,000 and if you sell it for say £325,000 then there is no gain and therefore no CGT payable.

More information on this can be found here

https://www.gov.uk/capital-gains-tax-for-non-residents-uk-residential-property

I hope this is helpful and answers your question.

If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.

taxadvisor.uk and other Tax Specialists are ready to help you
Expert:  taxadvisor.uk replied 2 years ago.
I thank you for accepting my answer.

Best wishes.

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