Tax Implications

Tax Implications of Selling Property

Understanding Capital Gains Tax and other financial considerations

Capital Gains Tax (CGT) Overview

When CGT Applies

You may owe CGT if you sell:

  • A second home
  • A buy-to-let property
  • An inherited property
  • A property no longer your main home

When CGT Doesn’t Apply

  • Your main home (usually)
  • Transfers between spouses
  • Gifts to charity
  • Properties sold at a loss

Private Residence Relief

Your main home is usually exempt from CGT.

  • Must be your only or main residence
  • You must have lived there
  • Last 9 months always exempt

CGT Rates (2024/25)

Your Tax Band CGT Rate on Property
Basic rate taxpayer 18%
Higher/additional rate 24%

Calculating Your Gain

Sale price
Minus Purchase price
Minus Allowable costs
Minus Annual exemption (£6,000)
= Taxable gain

Reporting CGT

  • Report within 60 days of completion
  • Pay CGT within same 60 days
  • Use online reporting service
  • Penalties for late reporting
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