CGT

[Ellie99]

Originally posted this on the property board but thinking it might be better here. Hope someone can help. Tnx

Hi, would appreciate input on the following pls?

Originally owned two properties. One main residence and one rental. (30 years)

Sold main residence in 2019.

Moved into rental property in 2019. Main residence since then.

Now wish to sell and purchase a new main residence.

Will any CGT be due if selling and buying simultaneously?

Will LBBT (Scotland) just be standard if selling and buying simultaneously?

Thanks
Ellie

[AGoodman]

Yes, there is likely to be CGT payable on the sale as you have only lived there for, say, 6 out of 30 years. Principal private residence relief (PPR) is proportionate.

You would calculate the actual gain (deducting legal fees, capital improvements etc) to reach a monetary figure for your gain. Deduct approx 20% PPR and £3000 annual exemption. The balance will be subject to capital gains tax.

No idea on LBBT but SDLT would be fine as you only own one property at the end of the process. I'd be surprised if LBBT is different.

[Ellie99]

Thank you for your reply.
Can I assume that's one off total £3k exemption?

Thanks

[Ellie99]

Thank you for your reply.

So it doesn't matter that the proceeds are to be used to replace main residence then?

Can I assume that's one off total £3k exemption?

Thanks

[Ellie99]

Sorry, messed my reply up and can't see how to edit it or delete duplicate part.

[AGoodman]

The relevant relief for CGT is principal private residence relief, which is proportionate. It doesn't matter what you are buying (or if you are buying anything at all).
The relief for SDLT is replacing your only or main residence, which is irrelevant to you as you will only have one home anyway.

The £3,000 exemption is annual, so you can only use it once against a single gain such as this.

[Ellie99]

Thank you once again. Much appreciated.