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Ask Your Own Question, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 5147
Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
Type Your Tax Question Here... is online now

I would like someone to do the capital gains tax calculation

This answer was rated:

I would like someone to do the capital gains tax calculation for a property I have owned and lived in but now rent. I plan to sell it in July this year but want to know that tax due before I commit to selling. Purchased property 3/11/2006 for £300,000. Lived in property until 8/2/2013. Rented it from 8/2/2013 until 8/9/2014. And then again from 8/11/2014 until now (tenant will vacate 7/7/2015). Current value is £730,000. We do not own any other properties and are currently living in a rented property.
Hello and welcome to the site. Thank you for your question.

Please leave it with me and I will revert to you with CGT calculations
Please confirm whether owned in sole name or joint names.

Many thanks
Customer: replied 3 years ago.
It is owned jointly with my husband. Thank you.
thank you for your reply
Thank you for your patience.

Here are my calculations.... the good news is that your whole gain is covered by private residence relief and letting relief and therefore no CGT payable.

Sale of property £730,000
Cost price £300,000
Capital improvements £0
Agents fees, solicitors fee and other costs - say £0
Total cost price £300,000
Potential gain £430,000
Period of ownership - months 102
Period as main residence - months 75
Private residence relief - months 93
Potential capital gain £430,000
Gain covered by private residence relief
(93/102) x 430,000 £392,059
Gain subject to capital gains tax (430,000-392,059) £37,941
Letting relief - maximum £37,941
This is lower of
£40,000 per owner £80,000
Private residence relief £392,059
Gain on the part of the property that's been let £37,941
Net chargeable gain after letting relief £0
CGT £0

I hope this is helpful and answers your question.

If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.

Customer: replied 3 years ago.
Hi, thank you so much for your calculations. I guess the only questions I have are whether we have any leeway for example if the property sells for £10,000 more of if it takes a few more months to sell? Thank you
Thank you for reply...

Based on timescale and projected sale price you have given, you could have a chargeable gain of upto £102,200 (letting relief £40,000 x 2 and gains allowance £11,100k x 2) and you would still avoid CGT.

I hope this is helpful.

If you are happy and there are no more issues I will appreciate if you would kindly rate/accept the service I provided to ensure I get credited for it. and other Tax Specialists are ready to help you
I thank you for accepting my answer.

Best wishes.