Have Tax Questions? Ask a Tax Expert for Answers ASAP
It would be on the full £100K less the annual exemption of £11,100 (this exemption is just for capital gains, you still have a personal allowance to use against income)
Not sure what you mean by a working example
Income less personal allowances £11,00 - whats left over liable to Income tax and National Insurance and
Capital gain less annual exemption allowance £11,100 - whats left over liable to capital gains tax
Do let know if I can assist further
Hello, I am Keith, one of the experts on Just Answer, and pleased to be able to help you with your question. I see my colleague has opted out.
25K of the gain will be subject to 18% tax [4.5K] and 75K at 28% [21K], total CGT due 25.5K.
I do hope that helps.
I has assumed that you had allowed the Annual Exempt Amount of 11.1K. Therefore only 75K - 11.1K = 63.9K would be at the 28% level, say 18K so some 22.4K due.
Then in addition to the Annual Exempt Amount (AEA) the following rules apply.
Take the total ownership time in months . Take the letting period in months less 18 [A] (for the last 18 months you are deemed to be in residence even if this is not the case). A / B is the proportion of the gain subject to CGT and you also are entitled to Lettings Relief (LR) up to 40K to offset any gain in addition to the AEA.
Please be so kind as to rate me before you leave the Just Answer site.
The letters were to indicate the relevant months to calculate the proportion. 66 / 92 say 72% of the gain exposed to CGT less AEA and LR.
You have it to a 'T' to use an old expression!
25K of the gain will be subject to 18% tax [4.5K] and 23.9K at 28% [say 6.7K], total CGT due 11.2K.
Please don't forget my rating before you leave the Just Answer site.
Thank you for your support.