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Capital gain on a flat that has been lived in and then let out?

(3 Posts)
longerdays Thu 26-Jan-17 11:21:18

Hello. I know this has been asked before but tax treatment seems to change a lot so was wondering if someone on here is an accountant or similar?

If you had a flat that you lived in for say 10 years then let it out for 10 years and now want to sell it how is any gain in price treated for tax purposes? I know there used to be various allowances etc but suspect this has all changed since last tried to understand this. Thanks very much.

Trethew Fri 27-Jan-17 02:54:21

it's complicated!

www.which.co.uk/money/tax/capital-gains-tax/guides/capital-gains-tax-on-property

You can also offset certain costs (repairs, replacements, estate agents, legal fees etc) against the profit, but don't include stuff you've already offset against the letting income

Poosnu Fri 27-Jan-17 03:42:57

If it was your main residence when you lived there (your only home available for occupation) part of the gain will be exempt from CGT under the principal private residence exemption. This is calculated on a time apportioned basis of total ownership, plus the last 18(?) months are also free.

Lettings relief may also be available - exempting up to £40k of gain.

As s previous poster mentioned, you can deduct capital expenditure from the total gain to work out the gain actually subject to CGT - so things like SDLT, acquisition costs, costs of capital improvements. Income expenditure (letting agents fees or regular maintenance costs e.g.) cannot be deducted for CGT.

You will need to report this on your self assessment return and if you are unsure it might be worth paying an accountant to do the calculation for you.

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