There are many things involved with selling a property, and in this FAQ we have tried to summarise the most common situations.
Selling your own home
- If you sell your own home, you usually do not have to pay Capital Gains Tax. You can usually claim Private Residence Relief as long as the following conditions apply:
- this is your only home and you have lived in it the entire time you have owned it
- you have not rented part of it out (this does not include having a lodger who shares a living space with you)
- you have not used any part of your property exclusively for business purposes (this does not include using a room as a study for some of the week)
- the grounds, including buildings, are less than 5,000 square metres
Selling a property that wasn’t your home
- When you sell a property that wasn’t your home, you will usually have Capital Gains Tax to pay. This must be reported and paid to HMRC within 60 days of the sale being completed.
- This process is completed via HMRC’s online services. If you have a Government Gateway account (for example to access your Personal Tax account, or your Self Assessment account), you can use these login details. Alternatively you can set up an account.
- You will need to have the following to hand in order to complete the Capital Gains Return:
- address and postcode of the property
- date you purchased/obtained the property
- date you exchanged contracts when you were selling (or disposing of) the property
- date you completed
- value of the property when it was purchased/obtained (you may need to use the market value if you received it as a gift, you inherited it, you sold it for less than it was worth to help the buyer, you owned it before April 1982)
- any costs involved in the purchase, sale or improving the property
- This can sometimes be a complicated process – it is often worth speaking with an accountant who can do the Capital Gains Return for you. You can get in touch with us if you need help. There is also a wealth of information on the HMRC website.