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Sam, Accountant
Category: Tax
Satisfied Customers: 14153
Experience:  26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
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What is the capital gains you would have to pay on selling

Customer Question

what is the capital gains you would have to pay on selling a second property for £220,000 which was bought for £60,000 18 years ago.
Submitted: 2 years ago.
Category: Tax
Expert:  Sam replied 2 years ago.
Hi Thanks for your question Initially the gain would be £160,000 from which the costs to sell and buy (estate agent fees and legal fees) and the cost of any capital improvements (new kitchen, new bathroom etc) could also be deducted. Then tax reliefs would be consider, for example if this had been the only and main residence for any time, and what dates this was the main residence (and then you would apply this to the gain so say it has been the main residence for the first 4 years - it would be 36 months/216 months x gain) and then if the property had been let out, if so what dates (and income to declared to HMRC) this would then allow the consideration of private lettings rleif up to a maximum of £40,000 further relief. Then the first £11,100 would be exempt as this is the annual exemption allowance.And any remaining gain would be charged at 18% or 28% or a mix of the both (depending on your level of income) But as a raw position (without any buying and selling costs,capital improvements or tax reliefs) £160,000 gain less £11,100 = £148900 with at most £31865 at 18% = £5735.70 and the reminder (£128,135) at 28% =3587.80 so total of £41613.50 If you would like a full, and more accurate calculation relevant to your actual circumstances then I can send an additional services request for the full calculation Thanks Sam
Expert:  Sam replied 2 years ago.
Do let me know if you require any further assistance