You're entitled to some Private Residence Relief
You need to work out what proportion of your gain you get relief on.
Your calculation will be complex because there are several things that affect your relief. Find out how to get help with working out your tax.
What affects your relief
The relief you get when you sell your property is affected by:
- when you lived there
- what you used it for
When you lived there
In most cases, you only get relief for one home for any period. You must work out when you lived in your property as your main home.
If you’re married or in a civil partnership only one home per couple counts as your main home at any one time.
If you’ve nominated a home you can’t get relief for another property for the time your home is nominated, apart from for certain periods that always qualify for relief.
What you used it for
If you never lived in the part of your home you let out or used only for business you don’t get any relief on that part.
If at any time you did, you’ll get relief for:
- the last 9 months you owned the property
- any time you didn’t let it out or use it for business
You may get Letting Relief if you let out part of your home.
Example You sell your home and make a gain of £100,000.
You owned the property for 20 years but you lived in another home for 5 (25% of the time). The time you lived away wasn’t during the last 9 months or another period that qualified for relief. This means the amount you get relief on is reduced by 25% (25% of £100,000, which is £25,000). You get relief on £75,000.
The home you’re selling has 10 rooms. You used one room (10% of your home) exclusively for business for 2 years (10% of the period you owned it). The time you used it for business wasn’t during the last 9 months you owned the property. This means the amount you get relief on (£75,000) is reduced by a further 1% (10% of 10%). You get relief on 99% of £75,000, which is £74,250.
What to do next
There are other rules that may affect the amount of Capital Gains Tax you pay. Work out if you need to pay.
Your answers
- 2. Has the property you're selling been nominated as your main home for the entire time you've owned it?
- No
- Change 2. Has the property you're selling been nominated as your main home for the entire time you've owned it?
- 3. Are the grounds of the home you're selling bigger than 5,000 square metres including the buildings?
- No
- Change 3. Are the grounds of the home you're selling bigger than 5,000 square metres including the buildings?
- 4. Have you let out any part of the home you’re selling or used any part of it exclusively for business?
- Yes
- Change 4. Have you let out any part of the home you’re selling or used any part of it exclusively for business?