Hello,
I would be grateful if someone could confirm the order of the CGT tax calculation in order to arrive at the net gain, specifically this is to do with the calculation of PPR.
For example: I sold a house (which I have lived in and subsequently rented) for 305000. I purchased the house for 78750. My qualifying (happy with this bit) PPR period was 64/218 months.
(1) Is my PPR calculated as simply 64/218 x (30500-78750) = 58388? Or
(2) Is my PPR calculated as only after BUYING COSTS are deducted.....64/218 x (305000-Purchase price-solicitors fees-estate agency fees)? Or
(3) Is my PPR calculated only after BUYING & SELLING COSTS and MORTGAGE REDEMPTION are deducted?
Obviously I get a higher PPR is I only deduct costs after reliefs are applied?
Grateful if someone could help me clear up my understandind as cannot find a logical step-by-step process in HMRC guidance (only calculators that 'hide' individual steps.
Many thanks
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