Postby Lambs » Sat Jul 22, 2023 4:32 pm
Dear S,
You are right that you do get up to 2 years to decide which of the 2 (or more) residence is your main residence. So there is perhaps an opportunity to refine the calculations. But there are two other points here:
We typically try to avoid the risk of "tainting" the ownership period of the new property, as we do not know for how long it will be owned / how large will be the gain on the new property. We balance this with trying to avoid having to pay tax today on the old property.
But BD's point was that you should be able manage that will still being able to avoid intervening in the natural order: assuming the maths is broadly accurate any net gain from being slightly over the 9-month window should be mopped up by 2 x Annual Exemption - assuming we still have an Annual Exemption by the time that gain is made, of course. It has been halved this tax year and is set to be halved again in 2024/25. (And BD probably wouldn't have known about the slashing of the AE back in 2021
For clarity, the 9-month window looks back from disposal. So messing around with nominations will likely result in overlap and at least partly wasting the 9 months. But if, say, E got to 15 months and still hadn't managed to sell the first property, then he should definitely have taken advice on making a nomination within the 2-year window. Once validly made - but ONLY if so made - then it can be varied at any point later on.
Trust this is useful.
Regards,
Lambs