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Selling my BTL
Beverley Zane
Posted: 23 July 2017 19:13:04(UTC)
#1

Joined: 23/07/2017(UTC)
Posts: 1

Hi guys i'd really appreciate some help.

I bought a flat back in 2010 which I lived in for 5 years when I was single.

In 2015 I got with my current partner and i decided to rent the flat out so I spoke with a local broker and got a buy to let mortgage.

Times have moved on and i'd really like to sell the flat now so that we can buy a bigger house but i'm really worried about capital gains tax and whether anything would be due. The flat has been rented for about the last 20 months.

Can anyone advise me if capital gains tax would be due?

Thanks!

Bev
Amit Kapoor
Posted: 24 July 2017 10:30:10(UTC)
#2

Joined: 01/09/2016(UTC)
Posts: 4

Thanks: 1 times
Was thanked: 2 time(s) in 2 post(s)
Hi Bev

The gov.uk guidance on this is actually very helpful. In your case, you will probably have little or no capital gains tax to pay - as last 18 months after you moved out is exempt. You may become liable for 2 months of the 7 years you have held the property. However, that is bound to be well within your annual capital gains allowance.

Regards
Amit
1 user thanked Amit Kapoor for this post.
gillyann on 24/07/2017(UTC)
Alan Selwood
Posted: 24 July 2017 15:41:36(UTC)
#3

Joined: 17/12/2011(UTC)
Posts: 2,491

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Don't forget that after selling the flat, if you already own another property and then buy the larger house, you could well be liable for the extra stamp duty rate on the new property purchase.

Of course if you sell both the flat and the current property in order to consolidate and buy a new property, you should be OK - but check the timing of sales and purchase, and the rules, with the conveyancing solicitor so that you don't get any unexpected or unnecessary surprises!
S_M
Posted: 25 July 2017 05:08:02(UTC)
#4

Joined: 17/03/2011(UTC)
Posts: 485

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Beverley Zane;49148 wrote:
Hi guys i'd really appreciate some help.

I bought a flat back in 2010 which I lived in for 5 years when I was single.

In 2015 I got with my current partner and i decided to rent the flat out so I spoke with a local broker and got a buy to let mortgage.

Times have moved on and i'd really like to sell the flat now so that we can buy a bigger house but i'm really worried about capital gains tax and whether anything would be due. The flat has been rented for about the last 20 months.

Can anyone advise me if capital gains tax would be due?

Thanks!

Bev


Prior to April 2014 you where entitled to Private Principle Relief on sale of a property, which meant you could within 3 years of moving out of a residence claim this as your principle residence for the purpose of capital gains on sale.

My understanding (and I last studied CGT in depth in 2012/2013) is this period for disposal is now 18 months, which now seems to have lapsed in your situation. I would recommend that you have a chat with an accountant if you are not sure about any potential tax liability.

The CGT annual exemption this current tax year is £11,300 meaning no tax is payable up to this amount on disposal of your flat.

Another factor that may affect this is whether you jointly own your current property.

In terms of any Tax due, well that really depends on how/if the value of your property has appreciated. In London prices after a significant upswing between 2012 and 2016 have now stabilised and may even be falling in some areas.
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