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 taxadvisor.uk Your Own Question
taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 4995
Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
54961312
Type Your Tax Question Here...
taxadvisor.uk is online now

I bought my house in feb 2006 for £200,000, I lived in it until

Resolved Question:

I bought my house in feb 2006 for £200,000, I lived in it until feb 2008 when I rented it out as i went abroad for a while. I moved back into my house in sept 2014. I am now selling with the sale going through hopefully this month, in march 2016.
I have sold it for £325,000, this is the total sale price. (the fees will come to approx 5000) .This house is my only property and was bought with a residential mortgage to live in myself. I am so confused as to if I have to pay CGT. Can you help at all.
many thanks
Submitted: 1 year ago.
Category: Tax
Expert:  taxadvisor.uk replied 1 year ago.
Thank you for your question..You say this house is my only property.Provided this property has been your only main residence notwithstanding the fact you went abroad for a while and the property was not let whilst you were abroad, then the whole gain would be covered by private residence relief and your CGT payable will be NIL.More information on private residence relief can be found on HS283 herehttps://www.gov.uk/government/publications/private-residence-relief-hs283-self-assessment-helpsheet/hs283-private-residence-reliefPlease look at period of absence after example 6 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 1 year ago.
thank you for your prompt response. My house was rented out for periods i was not living there
Expert:  taxadvisor.uk replied 1 year ago.
Thank you for your reply..You would claim letting relief for the period the period was let..your reliefs would beperiod of residence - 100% reliefFinal 18 months of ownership - 100% relief (if you moved back in Sep 2014 and having been living in the property this period is covered within period of residence above)- Letting relief for the period the property was let - up to a maximum of £40k per ownerAny balance not covered by above reliefs ..you claim annual gains allowance of £11,100 per owner and the rest would be chrageabl to CGT at 18%, 28% or a combination of both depending on your taxable income including the gain in the tax year.I hope this is helpful.
Customer: replied 1 year ago.
thank you this is very helpful. I have worked out the chargeable gain is 120,000 and the CGT exempt gain is 60,000. Minus the letting relief of 40,000 is 20,000, then personal allowance of 11,100, would be a total of 8900. I am a lower rate tax payer. My annual income is approx under 18000. does this seem right?
Expert:  taxadvisor.uk replied 1 year ago.
Thank you for reply.Letting relief is the lower ofa) £40,000b) private residence relief (£60,000)c) letting relief for period property letprovided b) and c) are in access of £40k then your calculation appear to be correct.CGT payable would be at 18%. I hope this is helpful.
taxadvisor.uk and other Tax Specialists are ready to help you
Customer: replied 1 year ago.
thank you your help has been invaluable. It is very confusing to me but I have a better understanding of CGT now.kind regards
Anja
Expert:  taxadvisor.uk replied 1 year ago.
I thank you for accepting my answer.Best wishes
Expert:  taxadvisor.uk replied 1 year ago.
Your reward of a generous bonus is greatly appreciated. Many thanks