Hi,
I am purchasing another house currently, before I sell my PPR next April. I intend to move into my 'second' house next April. At that point my second property will be my PPR, however there will be an overlap of some months. I don't consider my second property as an investment property in terms of CGT on disposal of it as I will move into it, and it will become my PPR. The reason that I am buying the 2nd property first and selling my PPR later is to make sure I have somewhere to go as the market is still rising fast in my area, and I have some work to do to the second property before taking up occupancy.
In terms of taxation there is stamp duty payable on the second house as it is second hand, but what I am unclear on is how would revenue treat the CGT on disposal of the second house, as presumably it is considered as an 'investment property' at this point in time. If for example the Revenue apportion some CGT over the time the house was considered an investment property, how do they calculate the CGT retrospectively to give a true reflection of the property's market value at the time it switched from being an investment property to a PPR, and is a portion of the stamp duty (partly a cost of acquisition) by connection deductible form the CGT bill.
Jonathan.
I am purchasing another house currently, before I sell my PPR next April. I intend to move into my 'second' house next April. At that point my second property will be my PPR, however there will be an overlap of some months. I don't consider my second property as an investment property in terms of CGT on disposal of it as I will move into it, and it will become my PPR. The reason that I am buying the 2nd property first and selling my PPR later is to make sure I have somewhere to go as the market is still rising fast in my area, and I have some work to do to the second property before taking up occupancy.
In terms of taxation there is stamp duty payable on the second house as it is second hand, but what I am unclear on is how would revenue treat the CGT on disposal of the second house, as presumably it is considered as an 'investment property' at this point in time. If for example the Revenue apportion some CGT over the time the house was considered an investment property, how do they calculate the CGT retrospectively to give a true reflection of the property's market value at the time it switched from being an investment property to a PPR, and is a portion of the stamp duty (partly a cost of acquisition) by connection deductible form the CGT bill.
Jonathan.