Capital Gains

B

billysparky

Guest
I am relocating, keeping my home but selling the land.
Will I have to pay tax even though I am buying a new home? :confused:
 
If you don't dispose of the former home property by 12 months after vacating it and moving to your new home then some portion of any eventual resale gain will be assessable for CGT. For example, if you had lived in it for 6 years, and hold onto it for a further 5 (i.e. 11 years ownership in total) and then sell it then (11 - (6 + 1)) / 11 = 4/11 = 37% of any eventual resale gain will be assessable for CGT. This is definitely the case if you rent the property out. However I am pretty sure that it's the same even if the property is not rented out. If you rent the property out within 5 years of purchase as an owner occupier then a clawback of stamp duty will also apply. If in doubt get independent, professional advice on the tax issues involved.
 
Are you selling the land attached to your house?? Depending on the amount of land being sold there could be a tax charge. Assuming you always lived in your house without moving out to rent it there will be no tax payable on the disposal.

You should clarify your position in relation to the adjoing land from a tax advisor or an accountant to be 100% sure,most solicitors would not know of hand
 
In respect of PPR relief, your PPR can be no more than 1 acre. So if your house and attaching land are less than 1 acre and you decide to sell the land there will be no CGT (subject to it having always been your PPR etc).
 
Thanks a lot for your help. Much appricated. Just to clarify my position, there are two folio numbers, 1 for the house & 1 for the land. I own both. Its the land I am selling. I am keeping my house & hope to purchase another house when I relocate.
 
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