Have Tax Questions? Ask a Tax Expert for Answers ASAP
Property purchased late 1982, never been my principal private residence.
Hi again.If you sell the property for £90,000 you will make a gain of £65,000. The first £10,900 of that will be exempt from CGT due to the annual exemption, assuming you have no other gains in the same tax year, and the balance of £54,100 will be taxable at 18%, 28% or a combination of the two rates depending on the level of your income in the tax year of disposal. If you sell the property in the current tax year, one of the following will apply to you:1 If your income including the taxable gain is less than £41,450, you will pay CGT on all the taxable gain at 18%.2 If your income excluding the taxable gain is more than £41,450, you will pay CGT on all the taxable gain at 28%.3 If your income excluding the taxable gain is less than £41,450 but more than £41,450 when add the taxable gain then some of the gain will be taxable at 18% and some at 28%.I'm afraid that whilst you used the property as your office, you won't be entitled to any relief for the sale of what was a business asset as too much time has passed since you stopped using it as such. That may or may not have been a problem in any event as the property would appear to be residential.As the property has never been your main home, you are not entitled to main residence relief or letting relief. If you lived in the property for a year or so, you might get some main residence relief for the last 18 months of ownership (assuming you live in it for no more than 18 months, more if you do) and letting relief. However, if HMRC thought that you had moved into the property short term simply as a tax saving exercise, they will seek to disallow any such claim.
Putting the property into joint names with a spouse or civil partner you live with will give you an extra £10,900 exemption but you need to take account of their income to assess what CGT rate they would pay in order to determine any tax saving to be had or otherwise.I hope this helps but let me know if you have any further questions.
property has been rented mostly as a business and has had and paid business rates for probably 27 of the years I have owned it . So last 3 years rented as residential I ran my business from the premises using all rooms as a business when first purchased then let it as a business premises for 7 years. does this make any difference as it appears your have the opinion it was residential.