CGT on let property

[J=Law]

Hi,

I own a house that I bought in August 2003 (£70,000), started letting out 12 months (or so) later when it was valued at £100,000 according to the mortgage details. It has been let out ever since, has always made a loss, and now needs renovations expected to cost around £7,000. It is expected to sell for around £125,000.

Can anybody advise how I would calculate the CGT due? I am a higher rate taxpayer so expect it will be at 28% bracket now.

Is it as easy as taking the anticipate sales cost (£125k) and deducting the value when it started to be let out (£100k) and deducting the renovation costs (£7k) and then any selling fees (say £2k) and then the annual CGT allowance (£10,600) to give a balance of £2,400 which the CGT is based on?

Can I also contribute my losses during the time it was rented out towards the deductions?

Would appreciate any help from anyone who can!!

Thanks

[Peter D]

The value when you first rented it out is not relevant. It is the purchase value that is used as the base cost. PPR and Letting relief, read HS283 on the HMRC web site, Leave you with no CGT liability.
the renovation costs would have only been deductible if they were capital in nature, like an extension, or a conservatory. General decoration and repairs are deductible form your rental income not any CGT calculation. :
Purchase 70000 14/08/2003
Disposal 125,000 14/08/2011
Total Gain 53,000
PRR 26,500 48 96
Capital Gain 26,500
Lett Relief 26,486 Qual Days 1460
Net Gain 14
CG Allow 10,600
CGT 18% 0 0
CGT 28% 0 0

CGT Bill 0

Regards Peter

[J=Law]

Wow - thanks a lot Peter.
Jenni

[maths]

Did you actually live in the property as your residence prior to the letting?

[J=Law]

Hi Maths,

Yes, I lived at the property as my first home - then I met my now husband and moved in with him but kept it in case things didn't work out. Age old story I suppose!

Jenni