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TonyTax
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15839
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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TO SELL A PROPERTY THAT I HAVE OWNED SINCE 1961 BUT IN 1966

Customer Question

I AM PLANNING TO SELL A PROPERTY THAT I HAVE OWNED SINCE 1961 BUT IN 1966 I MARRIED THEN MY FATHER RESIDED UNTIL HIS DEATH IN 1971.
I THEN TURNED THE PROPERTY INTO RENTED ACCOMMODATION AND HAVE CARRIED ON UNTIL NOW SO I NEED TO WORK OUT THE CG TAX WHEN I SELL.
HOW WILL THE PERIOD FROM 1966 TO 1971 BE TREATED?
I WOULD APPRECIATE ANY INFORMATION YOU COULD LET ME HAVE.
MY EMAIL IS ***@******.***
Submitted: 9 months ago.
Category: Tax
Expert:  TonyTax replied 9 months ago.

Hi.

Your gain will be calculated by taking the value of the property as at 31 March 1982 and adding to that the cost of any improvements you have made to it since then. You deduct that total from the disposal proceeds of the property. You can also deduct the costs of purchase and sale (legal fees, stamp duty, survey fees, selling agent fees). That will leave you with a gain or a loss. If you have a gain, you deduct the annual CGT exemption of £11,100 to arrive at the net taxable gain.

There are two rates of CGT, 18% and 28%. The rate or combination of rates that you will pay will be dependent on the sum of your income and the net taxable gain in the tax year you sell the property. The most that can be taxed at 18% is £32,000 and that will be reduced by £1 for every £1 of income you have in excess of £11,000, the personal allowance. Any part of the gain not taxed at 18% will be taxed at 28%. Unless you have lived in the property since 31 March 1982, you won't be entitled to any main residence relief.

There is a calculator which will give you a rough guide to your CGT liability here. Let me know if you need any help using it.

I hope this helps but let me know if you have any further questions.

TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15839
Experience: Inc Tax, CGT, Corp Tax, IHT, VAT.
TonyTax and other Tax Specialists are ready to help you
Customer: replied 9 months ago.
Hello Tony,
I was well pleased with your answer to my question I have just put the property on the market so I am a bit previous asking question about capital gains, however if I have any more questions I will get in touch.
Thank you again, Emmie Salter
Expert:  TonyTax replied 9 months ago.

OK. Good luck with the sale.

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