Sarah, thank you for your patience
The capital gains calculations would be as follows:
Main residence (Oct 1996 to Jun 2006) = say 117 mths
Rented period (Jul 2006 to Dec 2013) = 90 mths
Total period of ownership (Oct 1996 to say Dec 2013) = 207 mths
Property sold in Jan 2014
Private residence relief = 117 mths
The final 36 months always qualify for relief up to 5 Apr 2014, even if you weren't living there, as long as it's been your only or main home at some point during the time that you've owned it.
Additional private residence relief = 36 mths
Total period of ownership =207 mths
Capital gain = 102,858 (158,000-(49,950+2,000+3192))
[I have rounded figures for ease of understanding]
Period covered by private residence relief (117+36) = 153 mths out of 207 mths
153/207 x 102,858 = 76,025
Gain subject to CGT (102,858-76,025) = £ 26,833
There is a further relief available called "Letting relief". This further relief is due where:
- you sell a dwelling house which is or has been your only or main residence, and
- part or all of it has at some time in your period of ownership been let as residential accommodation.
The maximum Letting Relief due
This is the lower of:
· £ 40,000
· £ 76,025 (the Private Residence Relief due)
· £ 26,833 (the gain on the part of the property that's been let) - (54/207 x 102,858) = 26,832
Gain chargeable to Capital Gains Tax after Letting relief (26,833-26,833) = £ nil
More information on private residence relief can be found here
I hope this is helpful and answers your question.
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