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taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 4715
Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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I have sold a property that was our main home and has been

Customer Question

I have sold a property that was our main home and has been rented for a number of years
the gain is 210,000 with CGT £56000 to pay, however i am buying the property have been renting for the same time for 210,000.
Would this wipe out my CGT bill, i have been told it will but not sure
Submitted: 11 months ago.
Category: Tax
Expert:  taxadvisor.uk replied 11 months ago.
Thank you for your question.Just for clarification please...Please confirm the property you have sold that was also your main home for a time during the period of ownership realised a gain of £210,000 and you make your CGT payable on it £56,000. Have you considered all reliefs and allowances in arriving at the CGT figure? you have an effective rate of 26.6% (seems high)I am happy to carry out some calaculations for you if you wish.Reinvesting the gain in a residential property does not wipe out CGT bill. CGT is based on gain made and you cannot offset reinvestment against it. 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.
Customer: replied 11 months ago.
hi yes the property was my main home
the property was purchased in1999 for the cost including stamp duty and fees for 223,000
we lived in the property until 2004 then moved out and rented it until may 2015
then sold the property for 695,00 less expenses 11,875.00
we are planning to purchase the property we live in and rent it out.
i was told we would get roll over relief, and the CGT
I am confused?Best regards ***** *****
Expert:  taxadvisor.uk replied 10 months ago.
Peter, thank you for your reply and for additional information.Based on information provided, in the absence of actual dates, I make it you had the property for 16 years and 5 of those were property as your main residence.My CGT calculation is based on this and assumes the property is jointly owned - see attached.I have applied CGT rate of 28% worst scenario as some gain may be taxed at 18% depending on your taxable income income gain in the tax year of sale. I hope this is helpful and answers your question
Customer: replied 10 months ago.
Many thanks
One thing the property was purchased in my name only
I have put in a new kitchen and bathroom before selling
Capital expenditure approx 20,000
Expert:  taxadvisor.uk replied 10 months ago.
Thank you for your reply.here are revised calculations... please note I have sent you two scenariosone showing property as main residence for 5 years and the second showing property as main residence for 6 years in the absence of actual dates.. I hope this is helpful.If there are no more issues, I will appreciate if you would kindly rate my service/accept the service I have provided before you leave the site, to ensure I get credited for it by Just Answer.

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