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capital gains tax & house in Uk

capital gains tax & house in Uk

Old Oct 9th 2007, 5:04 pm
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Default capital gains tax & house in Uk

just been watching govt financial statement and it says that capital gains tax is now 18% with nolead in period. Our house is up for sale and we are hoping to move to oz soon but house wont be sold (no buyer yet)does that then mean we have to pay capital gains tax on our money from house when it eventually sells!!!!!!!!!!!!!!!!! or am I just panicking
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Old Oct 9th 2007, 5:20 pm
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Default Re: capital gains tax & house in Uk

Yes your panicking, got nothing to do with houses.
http://news.bbc.co.uk/1/hi/business/7035734.stm
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Old Oct 9th 2007, 8:03 pm
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Default Re: capital gains tax & house in Uk

I think if the house you sell has been your main house there is no CGT to pay. I'm not sure how many years after you move out, you have to sell before you would be liable though??
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Old Oct 10th 2007, 6:15 am
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Default Re: capital gains tax & house in Uk

You do not pay capital gains tax on your main place of residence... in the UK or in Australia.

Mark.
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Old Oct 10th 2007, 8:12 am
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Default Re: capital gains tax & house in Uk

thanks for that folks. thought I was just panicking
If the house has been our main residence over here is there a time scale before we incur any capital gains as it could take some time to sell
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Old Oct 10th 2007, 8:27 am
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Default Re: capital gains tax & house in Uk

Originally Posted by tillysmum View Post
thanks for that folks. thought I was just panicking
If the house has been our main residence over here is there a time scale before we incur any capital gains as it could take some time to sell

In the UK or in Australia?
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Old Oct 10th 2007, 8:40 am
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Default Re: capital gains tax & house in Uk

Originally Posted by tillysmum View Post
thanks for that folks. thought I was just panicking
If the house has been our main residence over here is there a time scale before we incur any capital gains as it could take some time to sell
Yes, you get two years after you have moved out before you become liable for CGT on your main residence - this new flat rate of 18% DOES now apply though (been checking this out) as this is the rate for ALL CGT gains - not just businesses
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Old Oct 10th 2007, 8:43 am
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Default Re: capital gains tax & house in Uk

Originally Posted by sammyg View Post
Yes, you get two years after you have moved out before you become liable for CGT on your main residence - this new flat rate of 18% DOES now apply though (been checking this out) as this is the rate for ALL CGT gains - not just businesses
I dont think thats right, there is a much longer period than that I believe. The problem starts if you buy a property in Oz before selling the UK house or any other house anywhere for that matter.

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Old Oct 10th 2007, 8:49 am
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Default Re: capital gains tax & house in Uk

Originally Posted by joho View Post
I dont think thats right, there is a much longer period than that I believe. The problem starts if you buy a property in Oz before selling the UK house or any other house anywhere for that matter.

Jo
Just checked and its 6 years if you rent it out and forever if you dont get an income from it.

see link and got to 'when you can make this choice' and look at the sentance before the example and the example.

http://www.ato.gov.au/individuals/co...tent/36887.htm
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Old Oct 10th 2007, 9:43 am
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Default Re: capital gains tax & house in Uk

Originally Posted by joho View Post
Just checked and its 6 years if you rent it out and forever if you dont get an income from it.

see link and got to 'when you can make this choice' and look at the sentance before the example and the example.

http://www.ato.gov.au/individuals/co...tent/36887.htm
Sorry, to make this clear i was only talking from the Uk tax liability side of things - if you moved out of your house in the UK you would be liable for CGT after two years as it is then no longer classed as your main residence.

I don't know what the tax implications are in oz?
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Old Oct 10th 2007, 9:57 am
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Default Re: capital gains tax & house in Uk

Originally Posted by sammyg View Post
Sorry, to make this clear i was only talking from the Uk tax liability side of things - if you moved out of your house in the UK you would be liable for CGT after two years as it is then no longer classed as your main residence.

I don't know what the tax implications are in oz?
Ah sorry.
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Old Oct 10th 2007, 10:24 am
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Default Re: capital gains tax & house in Uk

Originally Posted by sammyg View Post
Sorry, to make this clear i was only talking from the Uk tax liability side of things - if you moved out of your house in the UK you would be liable for CGT after two years as it is then no longer classed as your main residence.

I don't know what the tax implications are in oz?
Hmm, however if you are no longer a resident of the UK, and therefore not a resident for tax purposes, at the time of sale then is it not the case that you are no longer subject to the Inland Revenue but to the ATO?
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Old Oct 10th 2007, 10:50 am
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Default Re: capital gains tax & house in Uk

thanks again for the replies sorry if I have confused anyone.
Our house is up for sale and has been since May, no buyers yet. When our sponsored visa comes through, any day now, we hope to move quite quickly ie withn 4 weeks or so. The house will stay empty until sold we cant afford to buy a house in oz until this is sold so we will be renting.
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Old Oct 11th 2007, 3:30 am
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Default Re: capital gains tax & house in Uk

Originally Posted by longreach View Post
Hmm, however if you are no longer a resident of the UK, and therefore not a resident for tax purposes, at the time of sale then is it not the case that you are no longer subject to the Inland Revenue but to the ATO?
Not quite as simple as that. Capital gains tax is based on ordinary residence, not simple residence, so it's not quite as easy to "escape" as income tax.

Also it would be important to check if U.K. based assets come within the scope of U.K. capital gains tax regardless of owner's residence.

All that said, double tax relief should normally be available.
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Old Oct 11th 2007, 10:56 am
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Default Re: capital gains tax & house in Uk

Sorry guys ...must be a bit thick or too tired as my 3month son kept me up all night but we are wanting to rent our place out over here in the UK and then rent in Oz for a year or two - we would then sell our UK house before buying in Aus -we need to leave it at least a couple of years until redemption fee reduces.

We bought a property and spent a lot of time and money doing it up - and the rent should just about cover the mortgage - but if we lost 18% on it we would be hammered!!!!

as soon as we leave the UK are we liable for CG? Is it after two years?

thanks
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