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Where Taxpayers and Advisers Meet

CGT on primary home

oxforshire_cat
Posts:3
Joined:Thu Mar 02, 2017 11:46 am
CGT on primary home

Postby oxforshire_cat » Thu Mar 02, 2017 11:55 am

Hello,
I wonder if somebody can help. We have a house in London, we bought it and lived in it for 2 years then moved to Oxfordshire for my husband's job and we have been here for 3 years (although he left that job a year ago and working for himself now). We are now thinking of selling and buying here but have realised that CGT now are applicable even if we haven't bought a new home, but for having it rented out. I had a look at the GOV tax relief calculator and it says:

Have you lived away from your home?

Don’t include:
the first 12 months you owned your home if it was being built, renovated or you couldn’t sell your previous home
the last 18 months before selling your home (36 months if you’re disabled, in long-term residential care or you sold the property before 6 April 2014)
Also don’t include time you lived away from home for:
any reason for periods adding up to 3 years
work in the UK for up to 4 years
work outside the UK for any period


I'm unsure about the timings tough: by the time we sell we will just be over the 3 year period of (being away for any reason) there is a 4 year gap for work but he has now changed his work. Or could we add the 18 months needed to sell with the 3 years being away for any reason?

Can somebody help?

Thanks

bip
Posts:9
Joined:Tue Nov 03, 2015 11:43 am

Re: CGT on primary home

Postby bip » Thu Mar 02, 2017 3:11 pm

For the period of absence such as three years for any reason or 4 years for work to be available, you have to have returned to the property and reoccupied it as your main residence.
Those deemed periods of occupation are only available if bounded by actual occupation.
The last 18 months however is available, even if you never returned to live in the property.

If the gain is significant, it may be worth returning home. Otherwise the gain will be apportioned between the times it qualified as main residence and those when it did not qualify.

Peter D
Posts:10668
Joined:Wed Aug 06, 2008 3:37 pm

Re: CGT on primary home

Postby Peter D » Fri Mar 03, 2017 10:44 am

Please provide dates and values and I'll run the numbers for you. With PPR and Letting relief there may be less CGT than you think. Regards Peter

michrogers
Posts:1
Joined:Tue Mar 14, 2017 4:44 am

Re: CGT on primary home

Postby michrogers » Tue Mar 14, 2017 5:34 am

I wonder if someone can help me to see if I have calculated my CGT correctly:

I purchased a house 08/2004, sold it 8/2015. Occupied it for 58 months, then rented it for 69 months, re occupied it for 5 months before it was sold.

net gain £255,000
PRR ((58+5+13+36)/132) * 255,000 (13 is 18 months' relief, less 5 months when I was living there at the end & 36 is 3 yrs for any reason)
Net PRR £216,363
Chargeable Gain £ 38,637
Letting Relief under TCGA92/S223(4) £ 38,636 ???


Is that correct? Thank you

bd6759
Posts:4262
Joined:Sat Feb 01, 2014 3:26 pm

Re: CGT on primary home

Postby bd6759 » Tue Mar 14, 2017 7:37 pm

The 36 months exemption would only be due if you intended to live permanently in the property. Selling after 5 months suggests that was not the case.

Otherwise the compuation looks OK.


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