Guest missymon Posted April 12, 2008 Share Posted April 12, 2008 Hi all, I am hoping some of you who have already escaped from UK can help me. I am trying to find out how Capital Gains Tax works and how much we may have to pay when we sell our house here in UK. May we not have to pay CGT if we are to buy another house even if it is in Australia? Thanks Monica Link to comment Share on other sites More sharing options...
Guest The Greens Posted April 12, 2008 Share Posted April 12, 2008 Hi, that's the problem here Tax tax and more Tax. (CGT - Chirpy Gordon Tax) But if it's your home, your only home, NOT a rental income house, and you have lived there as your domestic home, to my knowledge there is no CGT on the sale proceeds. Different if it's a second home, or a property you have been renting. We haven't sold our house yet but I know for sure when I sold my home before, I didn't pay any CGT. But take professional advice and be sure. Good Luck, EMMY Link to comment Share on other sites More sharing options...
tommo64 Posted April 12, 2008 Share Posted April 12, 2008 Hi Monica, I think Emmy's right. If its your only house and permanent residence you should not be liable for CGT. As far as I'm aware it only applies to second homes, buy-to-lets, etc. You could always check with a financial advisor or accountant to be sure. Cheers, Tom Link to comment Share on other sites More sharing options...
Guest Gollywobbler Posted April 12, 2008 Share Posted April 12, 2008 Hi Monica Why would you have to pay Capital Gains Tax on your Principal Private Residence? Are you sure that you have not seized upon a comment that I made in the CPV thread, put 2 and 2 togetger and made 5? What makes you think that my mother's situation is identical to yours? Best wishes Gill Link to comment Share on other sites More sharing options...
Guest missymon Posted April 12, 2008 Share Posted April 12, 2008 Hi Gill, No I hadn't read your thread about your mum's house. Our problem is that when we came back from living in the Caribbean 3 years ago at the age of 55 we could not get a mortgage so we decided to buy a house as a "Buy to let" and have lived in it ourselves and paid interest only. We put down a third of the value of the house as deposit. It is our only property and our main residence so are hoping we will not have to pay CGT. I am worried sick we may have dropped ourselves in the brown stuff by doing this. Monica :-) Link to comment Share on other sites More sharing options...
Guest WelshDebzs Posted April 13, 2008 Share Posted April 13, 2008 Hi Gill, No I hadn't read your thread about your mum's house. Our problem is that when we came back from living in the Caribbean 3 years ago at the age of 55 we could not get a mortgage so we decided to buy a house as a "Buy to let" and have lived in it ourselves and paid interest only. We put down a third of the value of the house as deposit. It is our only property and our main residence so are hoping we will not have to pay CGT. I am worried sick we may have dropped ourselves in the brown stuff by doing this. Monica :-) Hey Monica From the HMRC website You will not have to pay CGT when you dispose of your home if all the following conditions are met. Throughout the period that you owned it, it was your only home. You did actually use it as your home all the time that you owned it. Throughout the period that you owned it, you did not use it for any purpose other than as a home for yourself, your family and no more than one lodger. The house and garden do not exceed 5,000 square metres (about one and a quarter acres - roughly the size of a football pitch). Even if not all of these conditions are met, you may still be entitled to relief against all or part of the gain. From what you said you should be fine :smile: Debzsx Link to comment Share on other sites More sharing options...
Guest Gollywobbler Posted April 13, 2008 Share Posted April 13, 2008 Hi Monica I agree with Debs. There is no such thing as "Buy to Let Land" in England & Wales Land is land. The use of the land by the owner is what creates CGT liabiity (or not) in relation to it. "Buy to Let" is a concept that does not exist in English Land Law, nor is it recognised by English Tax Law. A "Buy to Let" mortgage is actually identical to any other legal charge on land too. A "Buy to Let Loan" is a financial services product only. It tends to be an excuse for the lender to charge around 2% in excess of the interest rate on a normal home loan aimed at owner occupiers. The deal between you and your mortgage lender is irrelevant in terms of CGT. I can't see any reason why you can't claim the full PPR exemption on your home. Best wishes Gill Link to comment Share on other sites More sharing options...
Guest Pinhead Posted April 13, 2008 Share Posted April 13, 2008 There is no taxable gain on your PPR in the UK. You also get the 2 years of gains after it is no longer your PPR even if you rent it out so make sure you get a valuation before you leave your house to move to Oz & if possible 2 years afterwards. The rules in the UK & Oz are the same. Link to comment Share on other sites More sharing options...
Guest missymon Posted April 13, 2008 Share Posted April 13, 2008 Thanks Gill and Debs, you have put my tiny mind at rest. It will be one thing less to worry about. Monica x Link to comment Share on other sites More sharing options...
Recommended Posts
Archived
This topic is now archived and is closed to further replies.