We can provide you with detailed advice on:

• How to calculate capital gains tax ('CGT')
• How to avoid and minimise capital gains tax
• Which capital gains tax reliefs you're entitled to
• Avoiding capital gains tax by becoming non UK resident
• How the principal private residence relief exemption will apply
• Claiming taper relief (business and non business asset rates) to reduce capital gains tax
• How the capital gains tax anti avoidance provisions will apply to your disposal

What will I receive

You'll receive a detailed e-mailed response to your capital gains tax question within three working days.

Sample capital gains tax question

Question:

Please work out my liability for Capital Gains Tax.

I bought a property for £79,000 in June 1990. I lived there between late 1991 and mid-1999. I have not lived there since then.

The property was bought with a partner. I am selling to them and expect to receive £130,000.

Work on the property equates to £5,000.

Please let me know if you require further information.

Answer:

Based on you owning and disposing of your 50% in the property for £130,000, the chargeable gain would be calculated as:

Proceeds 130,000

Cost ( 39,500)

Enhancement costs ( 2,500)

Gain 88,000

Indexation allowance (11,886)

Gain 76,114

You would then be entitled to Principal private residence ('PPR') relief.

This is calculated on the following basis:

Capital gain x period of occupation/period of ownership

In your case the last 36 months of ownership would be deemed to be occupied by you irrespective of whether you actually occupied the property during this period. Therefore PPR relief would be calculated as:

Period of ownership = June 1990 - Sept 2007 (assuming a Sept 07 disposal date) = 17 years 3 months

Period of occupation = Sept 91 - June 99 (assuming this was your occupation) = 7 years 9 months + last 36 months deemed occupation = 10 years 9 months

PPR relief = 10.75/17.25 * 76,114 = 47,433

Remaining gain = 28,681

Taper relief @ 40% = (11,472)

Annual exemption = (9,200)

Chargeable gain is around £8,000.

Assuming you were a higher rate taxpayer, your CGT charge would be approximately £3,200

Note that if you were married, you could transfer half of your 50% interest to your spouse and potentially avoid CGT in full (due to being able to utilise your spouses annual exemption).

In addition, if the property was let from the period post 1999 you would also be entitled to lettings relief which could eliminate the remaining gain (after PPR relief) in full.

How much does it cost

The service offers detailed capital gains tax advice for a discounted fee of £99.95, payable online via our secure servers.

To submit a capital gains tax question, please order here:

Capital Gains Tax Advice

Other Capital Gains Tax Advice Resources

We also offer a number of Tax Books which cover capital gains tax, including

Capital Gains Tax Advice Books How to Avoid Tax on Overseas Property If you're interested in reducing tax on your overseas property this book is for you. Whether you're buying a dream holiday home or building an overseas property empire, this invaluable tax saving resource will help you save money both in the UK and abroad. . . . keep reading How to Avoid Property Tax The best selling property tax guide. Find out how to avoid income tax and capital gains tax on your UK property(s). Whether you're a seasoned property investor, a newbie, have inherited a property that has shot up in value or simply own a property that has increased in value you'll find the information you need to know to reduce or eliminate your taxes in this comprehensive book. . . . keep reading Using a Property Company to Save Tax If you're interested in property investment/trading one of your first considerations should be whether you hold your property personally or via a company. It can have major tax implications, potentially saving thousands. This book tells you everything you need to know about using a property company. . . . keep reading How to Avoid Tax on your Stock Market Profits Essential reading for anyone with an interest in the stock market or other financial investments. This is a comprehensive and unique guide to the tax planning opportunities for a variety of investments from shares and gilts to options and futures . . . keep reading Property Capital Gains Tax Calculator Not a book, but such an excellent tax resource that we're including it here anyway. Save hundreds in accountants fees with this simple piece of software. For only £39.95 it will give you a detailed calculation of the CGT on your property disposals taking account of ALL reliefs (as well as highlighting tax planning opportunities!) . . . keep reading

Tax Articles

Look at our Capital Gains Tax Articles