Capital Gains

[Supergod]

Hi. My self and my fiancé just bought a new house together to move into when we get married(next couple of months). I have a house of my own at the moment which I want to hang onto for one more year. I was just wondering on what sum is the capital gain calculated? Is it the sale price less the current market value or the sale price less the original price. I would have thought it would be the first case although I have been wrong before!!!!
Thanks in advance.

 

[DrMoriarty]

Welcome to AAM, O fallible deity!

No, it would be the second. But if the house you're in now has been your PPR, you won't be liable for CGT anyway.
See here: http://www.revenue.ie/leaflets/cgt1.pdf

I've moved this thread to the taxation forum.

 

[Supergod]

It is my PPR at the moment but i wish to rent it out for the year so i would have to pay capital gains on the amount the property increases over the year? ( If it increases at all)

 

[DrMoriarty]

Have a look on p.15 of the leaflet!

Your existing home will still be considered your PPR for 12 months after you move out. However, you won't be able to claim tax relief on the mortgage interest (if any?) paid on the new house — i.e. you can only have one PPR for taxation purposes. As to which is the bigger saving, you'll have to crunch the numbers...

 

[Supergod]

thanks for your help

 

[Lorraine B]

Hi Supergod, don't forget about Stamp Duty clawback if you rent out your house within 5 years of buying it.