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HM Accountax Ltd
HM Accountax Ltd, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 181
Experience:  I am an accountancy professional with more than10 years hand on experience in audit, accountancy and tax affairs.
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I have sold my primary residence after living in it for 5

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Hello,I have sold my primary residence after living in it for 5 years and then letting it out while I worked overseas for 9 years. After returning to the UK in March 2019 I rented a property for me and my family. My tenants moved out in January 2020 and i us do the property for mid week stays in London instead of commuting back to the family home. I sold the property 09/09/2020. It is my primary and only residence I have ever owned. I am keen to know if there is any CGT to pay on this.How much do you charge for your services, and what services do you offer?Kind regards***** *****
JA: The Expert's answer will cost $10 to $100, depending on the issue type and time to respond. You'll see the exact amount on the next page and can decide then. It's way less expensive and more convenient than any face-to-face visit. When was the property or asset sold?
Customer: September 9 2020
JA: Anything else you want the Accountant to know before I connect you?
Customer: No

Hi,

I am an advisor at Just Answer and i am happy to answer your query.

You'll be liable to CGT on the disposal. however, you can claim PPR relief to reduce the CGT liability. PPR will be calculated as:

total gain * period of occupation / period of ownership.

I hope this answers your query.

Regards

Muhammad

Customer: replied 13 days ago.
I was under the impression that time overseas for work was not applied for cgt when it is your only home?

You are liable to CGT but You get relief if you were away from it for any period if you were working outside the UK

Customer: replied 13 days ago.
Ok great. So I only pay cgt for the period which I was based back in the uk and had tenants in the property, so March 2019 to January 2020?

Hi,

Yes, in broad terms you are right but you'll calculate it as follow:

1. Sales proceeds - Purchase cost = Total Gain

2. total gain * period of occupation / period of ownership. = PPR relief

3. Total gain - PPR relief - annual allowance = Chargeable gain * 18% or 28% depending on your income band

Customer: replied 13 days ago.
I purchased for 188k sold for 430k lived in the property for 5 years, rented it out whilst living overseas for 8.5 years... so all of that time is Covered u Dee PPR. I then rented it for a further 10 months to my long term tennents after Lading back in the uk. I sold it 4 days ago. I calculate that I only need to pay CGT for the 9 months after I moved back to the uk. Does that sound correct?

Yes, you are right & you should calculate the gain using the formula shown above. The net liability will be same

Customer: replied 13 days ago.
Wonderful thanks

Just an update and I was updating my answer but you replied - The final 18 months of your period of ownership always qualify for relief, regardless of how you use the property in that time, as long as the dwelling house has been your only or main residence at some point.

So you won't pay any CGT.

Customer: replied 13 days ago.
Fantastic!

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