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bigduckontax
bigduckontax, Accountant
Category: Tax
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I lived in a property years before moving to another

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i lived in a property for 20 years before moving to another property. i rented the first property for 2 years before selling it. do i have tax to pay
Submitted: 1 year ago.
Category: Tax
Expert:  bigduckontax replied 1 year ago.
Hello, I am Keith, one of the experts on Just Answer, and pleased to be able to help you with your question. Yes, but not much and maybe none at all! You are liable for Capital Gains Tax (CGT) for any gain made on the sale, but only for a small proportion. This is calculated in months. Your total ownership period is say 240 months. Your non occupation period is say 24 months, but for the last 18 months of ownership you are deemed to be in occupation even if this is not the case, so the non occupation drops to 6 months. Only 6 / 240 = 2.5% of the gain is liable to CGT. From this figure you can deduct your Annual Exempt Amount (AEA) of 11.1K and you will be entitled to Lettings Relief (LR) of up to 40K also. CGT is levied at 18% or 28% or a combination of the two rates depending on your income including the gain in the tax year of sale. The gain is the difference between the acquisition and the selling price. The former is what you paid for it plus purchase costs including Stamp Duty Land Tax plus any improvements eg installation of double glazing, central heating extensions etc, but not routine maintenance which, for the letting period only offsets rental income for Income Tax (IT) purposes. The selling price is net ie after deduction of selling costs including advertising. I do hope that you have found my answer of assistance.
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Expert:  bigduckontax replied 1 year ago.
Thank you for your support.