CGT on house sale after 1 year

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wrappo

Registered User
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Hi
We remortgaged our house last December with a view to renting it out and using the released equity to finance new house. The mortgage became an residential investment mortgage on an interest only basis. We never rented it out and the house is on the market since the summer. My question is about CGT - are we liable to it after a year if we don't sell the house in that time and is it pro rata after that?

Many thanks
 
If you don't dispose of the former PPR within 12 months of vacating it as your PPR then some portion of any eventual resale gain will be assessable for CGT. For example if it was your PPR for 6 years and then you vacated it and only sold it 3 years later (i.e. total ownership period of 9 years) then ((3-1)/9) = c. 22% of any gain would be assessable for CGT. These calculations are just rough and done in round years for simplicity. This issue is covered in lots of existing threads.
 
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