Quizzes & Puzzles0 min ago
House sale - Capital gains
Has anyone got any good sites / links about the rules regarding liability for capital gains tax on a house sale?
Thanks
Answers
No best answer has yet been selected by ian.miller. Once a best answer has been selected, it will be shown here.
For more on marking an answer as the "Best Answer", please visit our FAQ.(cont)
Capital gains are considered part of your income and are taxed at your marginal rate of tax when the gain has been added to your other income, currently 10 per cent, 20 per cent or 40 per cent. If on disposal you make a loss on an asset, this loss can be off-set against other gains in the same tax year, or the loss can be carried forward to subsequent tax years indefinitely. To calculate the gain you have made take the disposal value (sale price or market value if you are gifting the asset) and deduct (a) sales costs - solicitors and agents fees etc (b) purchase price (or market value if the asset was gifted to you - if you acquired the asset before 31 March 1982 you take the market value at that date) (c) purchase costs - solicitors etc (d) and expenditure on the asset whilst you have owned it - capital improvements which you have not been able to claim against any revenue from the asset as an expense.
Also, if you decide to live in rented accomodation for a while and put proceeds in the bank, does that help/hinder or not affect the liability criteria?
If you have several private residences or various leased or rented addresses, you nominate which is your principal private residence. Only if you fail to do so will the Revenue do it for you. The fact that you let it out now and again does not alter its status as your principal private residence. There is no minimum period of residence to qualify for principal private residence.
If you sell your principal private residence, bank the proceeds and then live in rented accomodation (which many people do) it does not affect things one jot. It was your principal private residence that you sold, and it does not fall for CGT.