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TonyTax
TonyTax, Tax Consultant
Category: Tax
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Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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If I sell my house and buy another cheaper one do I have to

Resolved Question:

If I sell my house and buy another cheaper one do I have to pay CPT on the difference
Submitted: 8 months ago.
Category: Tax
Expert:  TonyTax replied 8 months ago.

Hi.

Has the house you are considering selling been your main home for all of the time that you have owned it? If not, let me have further details.

Customer: replied 8 months ago.
It was purchased by me and was my marital home, it's the only home I own, I'm on the bills and registered with my Doctor close by however I do rent another flat as well.
Customer: replied 8 months ago.
how does one designate a property as one's main property?
Expert:  TonyTax replied 8 months ago.

You need to be able to prove that you live in the property you won even if you only actually own one. Can you elaborate on how you divide your time between the two properties please.

Customer: replied 8 months ago.
My difficulty is that my ex was granted custody of my daughter and although I frequently spend every day there I have another place too and I go back and forth.
Expert:  TonyTax replied 8 months ago.

How long have you had access to two homes?

Customer: replied 8 months ago.
Since 2009, I'm also disabled and have health issues. I'm not working.
Expert:  TonyTax replied 8 months ago.

Thanks.

Leave this with me while I draft my answer.

Customer: replied 8 months ago.
thank you
Expert:  TonyTax replied 8 months ago.

As you did not make an election for one of the two properties to be treated as your main home within two years of the date you had access to two homes, the question as to which is your main residence will be based on the facts.

Take a look at HS283. Assuming you lived in the property you own full time until you split from your ex, the gain for that period will be tax free as will the gain for the last 18 months of ownership. How much of any profit you make will be tax free will depend on how much the total profit from sale will be and how long you have owned the property.

If you claimed full exemption from CGT for the whole gain, you may be asked by HMRC to back it up with proof that it was your main home. There is alot of subjectivity here. The fact that your name is ***** ***** bills and that you are registered with a local Doctor helps. Take a look at CG64545 for more information on what criteria are looked at when determining an individual's main residence in the absence of a written election.

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

Expert:  TonyTax replied 8 months ago.

I have to go out for a short while but will be back in about 30 minutes to answer any follow up questions you may have.

Expert:  TonyTax replied 8 months ago.

Hi.

I'm just following up to find out if my answer helped or if you have any further questions.

TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15841
Experience: Inc Tax, CGT, Corp Tax, IHT, VAT.
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