capital gain on rented property

by **firekill** on Mon Feb 09, 2009 3:13 pm

Hi,
Myself & the wife are in the process of buying a new home , our house is up for sale but hasn,t sold yet . If we decide to keep our old house because we can,t sell it and then start renting it out , will we be liable for capital gains tax . i have looked on various websites and the information is quite confusing . i have read that if we sell the old house within 3 years of moving into the new house and even if its rented out during that period we wouldn,t be liable to cgt as it is still classed as qualifying for full residents relief. Any help here would be much appreciated.

by **maths** on Mon Feb 09, 2009 3:34 pm

Effectively any property which has been your main home may be sold CGT free up to 3 years after the date it ceased to be your main home.

If it is sold after this 3 year period a potential CGT laibility arises but if it is let out lettings relief will effectively result in no CGT for a period of time.