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Where Taxpayers and Advisers Meet

CGT on Selling home That was Rented out

Martintaxes
Posts:24
Joined:Fri Apr 28, 2017 12:25 pm
CGT on Selling home That was Rented out

Postby Martintaxes » Thu Mar 17, 2022 5:49 pm

Hello Everyone,
I'm trying to work out my CGT roughly on the potential sale my home that I will have lived in for 18 years and rented it out for 5 years. So total ownership would be 23 years.
Really it's approximate as I'm looking to the future on when best to sell it.
My question is around when I subtract the £12.3k CGT allowance, as this can mean the difference between a fair amount of CGT, versus almost no CGT.

Just using the years rather than months fraction, as it's approximate, and ignoring the 9 months relief for now:-

Let's say, including all start and end costs, my gain was 200k from the sale.
The rental period fraction liable for CGT would be (5/23)*£200k = £43478.

So, do I then calculate my CGT as 29% of £43478, then minus my £12,300 allowance = £12608 - £12,300 = £308?
OR,
would it be (£43478 - £12,300 allowance) x 29% = £8952?

Thank you very much in advance for your help.
Best wishes,
Martintaxes.

darthblingbling
Posts:514
Joined:Wed Aug 02, 2017 9:09 pm

Re: CGT on Selling home That was Rented out

Postby darthblingbling » Thu Mar 17, 2022 6:44 pm

Take away from gain first then work out CGT

Martintaxes
Posts:24
Joined:Fri Apr 28, 2017 12:25 pm

Re: CGT on Selling home That was Rented out

Postby Martintaxes » Sat Mar 19, 2022 12:02 am

Thanks very much for your help.


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