It will take only 2 minutes to fill in. Cookies on GOV. UK We use some essential cookies to make this website work. Accept additional cookies Reject additional cookies View cookies. Hide this message. Home Money and tax Capital Gains Tax. Capital Gains Tax. Capital Gains Tax rates You pay a different rate of tax on gains from residential property than you do on other assets.
You do not usually pay tax when you sell your home. We use cookies to allow us and selected partners to improve your experience and our advertising. By continuing to browse you consent to our use of cookies. You can understand more and change your cookies preferences here. You generally won't need to pay the tax when selling your main home.
However, you will usually face a CGT bill when selling a buy-to-let property or second home. You may also need to pay CGT if your home is partly used as a business premises, or you lease out part of your property.
Our short video explains who needs to pay CGT on property, and what the rates are. Bear in mind that any capital gains will be included when working out your tax status for the year, and may push you into a higher bracket. All taxpayers have an annual CGT allowance, meaning they can earn a certain amount tax-free. You can find out more in our guide to capital gains tax rates and allowances.
As the name suggests, CGT is only charged on the gains you make, rather than the amount you sell the property for. To work out your gain, deduct the amount you originally bought the property for from the sales price. Then deduct any legitimate costs involved with buying and selling, such as broker fees, stamp duty, and improvements to the property while you owned it. You can also offset losses when selling other assets, and these can be carried forward indefinitely. You claim your losses via your self-assessment tax return, or by calling HMRC.
You can claim losses up to four years after they were incurred. For UK properties sold on or after 27 October , you will need to pay the tax owed within 60 days of the completion of the sale or disposal. You'll do this by submitting a 'residential property return' and making a payment on account. For property sales made between 6 April and 26 October , the window to pay your CGT bill is 30 days.
You're allowed to deduct certain costs involved with buying and selling property from your gain when working out your CGT bill. These include:. Costs involved with improving assets, such as paying for an extension, can also be taken into account when working out your taxable gain.
However, you're not allowed to deduct costs involved with the upkeep of a property. You're also not allowed to deduct mortgage interest either though that can reduce the tax you pay on rental income. Find out more: selling a buy-to-let property. In most cases, you won't need to pay CGT when selling the property you live in, because you will be entitled to 'private residence relief'. You won't need to pay capital gains tax for the time a property was your main residence, plus the past nine months of ownership even if you weren't living in the property during those nine months.
People with a disability or those who move into a care home can claim for up to the past 36 months of ownership. If you use more than one home, you can nominate which will be tax-free.
Generally, it makes sense to nominate the one expected to make the largest gain when you come to sell it. You have two years from when you get a new home to make the nomination. Married couples and civil partners can have only one main home between them, but unmarried couples can each nominate a different home. Deciding how to calculate capital gains tax There are different ways to calculate your capital gains tax.
Indexation You can choose indexation if you acquired your assets before 21 September , and have held it for at least 12 months. Capital gains tax is payable as part of your income tax assessment for the relevant income year.
Have confidence in your future with help from a financial adviser. Learn more about financial advice. Explore other life moments.
Using equity to buy an investment property Michael Sloan explains how to calculate your equity and how to use it. How to save and budget We'll help you do the numbers so you can budget your income. Related products and services. Credit cards Compare between our credit cards to find the right one for you.
Home loans Home loans for every need with tools, calculators and guides to help you choose. Contact us. Visit a NAB branch. Visit your nearest NAB branch to speak to us in person. Find a branch. Call us. Let us help you with your personal banking needs.
0コメント