CGT on PPR if second property

H

hermes

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Guys

This may have been answered before so apologies.

My wife and I bought an apartment in 2003 for 320K, it's currently worth c.500K. It has been our PPR since purchase.

We're thinking of buying a house to live in as our PPR (from Jan 2007 say) and want to rent out our apt i.e. apt ceases to be our PPR in Jan 2007 say.

My questions relate to the possible sale of the apt in the future.

1.) Are we liable to pay CGT on the gain on the apartment for the period while it was our PPR (180K gain for the period 2003 to Jan 2007).

2.) Who determines the value of the apt at the point it ceases to be our PPR - i.e. who determines the gain ?

Thanks

Hermes
 
No the gain is based on the difference between the purchase price ( in 03) and the sale price less a proportionate amount for the period while it was your ppr.
 
The determination is done on a pro rata basis. You bought in 2003, it changed from PPR to investment in 2007, if you were to sell in 2013 you would have to pay CGT on 50% of the TOTAL gain in price (10 years owned - 4 years PPR - 1 year grace).

Also, you may have to pay stamp duty clawback on the apt since you'll be renting it within 5 years of when you first bought it.
 
Last edited:
It's ok to sell apartment within the five years but if you rent it you'll be liable to stamp duty clawback.
 
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