2. Work out your gain
You’ll need to work out your gain to find out whether you need to pay Capital Gains Tax.
In some situations you should use the market value of the property when working out your gain. Do this if:
- it was a gift (there are different rules if it was to your spouse, civil partner or a charity)
- you sold it for less than it was worth to help the buyer
- you inherited it (and don’t know the Inheritance Tax value)
- you owned it before April 1982
Selling in special circumstances
There are special rules for calculating your gain if:
- you sell a lease or part of your land
- your property is compulsorily purchased
If you’re a non-resident selling UK residential property you only pay tax on the gain you’ve made since 5 April.
Jointly owned property
If you own property jointly with other people, work out the gain for the share that you own.
You can deduct costs of buying, selling or improving your property from your gain. These include:
- estate agents’ and solicitors’ fees
- costs of improvement works, for example for an extension (normal maintenance costs, such as decorating, don’t count)
You may get tax relief if the property was:
- your home
- a business asset
- occupied by a dependent relative - find out more in the guidance on Private Residence Relief
Work out if you need to pay
When you’ve worked out your gain you need to work out if you need to report and pay Capital Gains Tax.
You may be able to use the Capital Gains Tax calculator to work out how much tax to pay on your property. You can’t use it if you:
- sold business premises or land
- sold other chargeable assets in the tax year, for example shares
- reduced your share of a property that you still jointly own
- claim any reliefs other than Private Residence Relief or Letting Relief
- are a company, agent, trustee or personal representative
Reporting a loss
The rules are different if you need to report a loss.