Following on from a recent post, I am hoping you can help clarify the calculation of the capital losses for our previous primary home turned rental property.
Timelines: We lived in a property for 6 years & 10 months, then rented it out for 8 years & 5 months before selling it. So, it was rented 55% of the time we owned the house.
Capital Losses: We purchased the house at the worst time possible - peak 2006! We also did spend heavily on renovating the house as well as adding an extension (costs captured under Enhancement Expenses). Details in the table below:
Selling Price:
€ 299,999
Less Original Purchase Price:
€ 345,000
Less Purchase Expenses:
€ 13,924
Less Selling Expenses:
€ 8,996
Less Enhancement Expenses:
€ 55,476
Capital Losses:
-€ 123,398
Can I claim to full capital loss? Or is the capital loss proportional to the time as a rental? So 55% of the €123k = €68k.
When were the enhancements carried out? When you lived in the property or when it was let?
I can't find the precise reference, and am subject to correction here, but if the improvement works were carried out before the period of rental then I don't think they can be used to increase the loss.