Profit From Your Home
Contrary to popular belief, the profit you make when you sell your home, or a former home, is not automatically exempt from Capital Gains Tax (CGT).
 
This tax exemption only applies to gains that relate to periods in which you lived in the property as your main home. However, it can be extended to certain periods when you were not living in that property.
 
For example, the last 18 months of ownership are exempt from tax, which is extended to 36 months where the owner or their spouse is disabled or moves into residential care. The 18-month exemption is due to be cut to nine months for sales made after 5 April 2020, but the 36-month exemption will remain in place.
 
Where you have let your former home at any time, even before you moved into the property, up to £40,000 of the gain can be exempt from CGT for each owner. This ‘lettings relief’ is due to be restricted for sales from 6 April 2020, so that it will only apply where the owner was in occupation at the same time as the tenant. The change will mean that nearly all periods of letting in the past will no longer qualify for the tax exemption.
 
Talk to us if you are planning to sell your home in 2020, as there are a number of tax reliefs which could affect the tax you pay.
 
ACTION POINT: Consider selling before 6 April 2020 to take advantage of the current tax reliefs.

Get in touch - If you'd like to find out more about how we can help you and your business pay less tax, generate more profits and create long-term wealth for you and your family, please get in touch now