Property rented two month- Do I pay Capital Gains?

Hi there,

We purchased a 2nd home whilst trying to sell our first home, in the end the house wasnt selling so we rented it out but kept if for sale. The house is now 2months into been rented and it looks like we have a buyer for the house. My question is do we have to pay Capital gains and if so how much. I regristed with prtb when I put if for rent so it is down as rental.

Any ans would be appreciated.
Thanks
Anna

Hi Anna,
Am I correct in assuming the house you're selling was the "old" one which you've been renting until it sells?

My first take would be that CGT shouldn't be payable on the first house as long as it is being sold within 12 months of you moving out.

CGT is not normally payable on your principle primary residence, and there is an allowance of 12 months from the date you move out during which the original house would still be considered your PPR.

The fact that the house has been rented out for 2 months shouldn't affect this additional 12 month PPR consideration.

Your best bet would be to talk to the solicitor handling the sale, who should be able to confirm if a CGT liability exists.

Charlie

Correct no CGT provided it was your PPR the last 12 months ownership will be treated as PPR for CGT purposes.
IF you moved out longer than 12 months ago, CGT may apply