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Buachaill, Barrister
Category: Law
Satisfied Customers: 10977
Experience:  Barrister 17 years experience
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I have a house in the uk and I am in the process of selling

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I have a house in the uk and I am in the process of selling it for 120k. For the past 4 years. During the 4 years the house has been let but we have made no profit. The mortgage and other costs exceeded the rent paid.We did not sell before due tp making sure life in France eas good for us. The house is being bought by tenants at a reduced price.
Am I liable for Capital Gains Tax?

1. Dear Rowland, Capital Gains Tax is only payable on any "gain". So, can you tell me, what was the purchase price of the house? What were your outgoings or costs associated with the house, excluding mortgage repayments?

Customer: replied 1 year ago.
163;38000 in1991 average outgoings directly to the property maintaince of property e.g. repairs etc a further £30 per month. Contractual obligations to tenants and repeated travel from France and hotels etc. and gas inspections averages £75 pet month. Mortgage is £600 per month due to shortfall caused by endowment policy

2. Dear Rowland, there will be no Capital Gains Tax payable. This is because your allowable outgoings which may be set against any gain were the £30 per month directly related to the maintenance of property. This is £3,600 per annum which over 25 years since the date of purchase equates to £95,000. TAken with the purchase price of 38k, you are receiving less than what you have spent on the property. Additionally, be aware that the interest element of the mortgage is deductible - not the capital repayments.

3. Be aware that you will not be able to deduct the £75 per month for travel from France etc. Be aware additionally, that if you had sold within two years of ceasing to live in the house, you would have qualified for Principal Private Residence relief which would have meant you would have had an exemption from CGT.

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Buachaill and 2 other Law Specialists are ready to help you
Customer: replied 1 year ago.
Thanks for your answer it was what I hoped for and it was what I hopef for after reading the gov. website but the reason you give was unexpected I expected to be told that I would have to pay on any profit since April because I live permanently abroad either way I am happy and will give you the appropriate rating
Thanks again