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Hello AA, I am Keith, one of the experts on Just Answer, and pleased to be able to help you with your question.
If you buy your new home whilst still owning the old, then you will be liable to the stamp duty surcharge of 3%. However, if you sell your first home within 3 years of the purchase of your second, you can apply to the Stamp Office for the surcharge to be refunded.
I do hope that you have found my reply of assistance.
HMRC will treat this as the sale of your sole or main domestic residence, but because you rented it out an element of the gain would be subject to Capital Gains Tax (CGT). 37 less 18 = 19 / 206 say 9.25% [you are deemed to be in residence for the last 18 months of ownership even if this is not the case] of any gain will be subject to CGT. However, you have a non cumulative Annual Exempt Amount (AEA) of 11.1K to offset this gain and as you were in occupation before the letting period then Letting Relief up to 40K also. I suspect that when the chips are down there will be no CGT to pay.
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Thank you for your support.