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Capital Gains Tax Headache

Capital Gains Tax Headache

Old Aug 25th 2006, 10:20 am
  #1  
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Default Capital Gains Tax Headache

A boring one im afraid.....Does anyone know about CGT?

If we sell our house and a flat we own i think we will be liable at least on the flat, but does anyone know if you can avoid paying it by leaving the country? I have heard you may be able to if you dont return for 5 years. If so do you have to be out of the country when you sell?

Cheers for any info.
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Old Aug 27th 2006, 8:56 pm
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Default Re: Capital Gains Tax Headache

Originally Posted by brandn
A boring one im afraid.....Does anyone know about CGT?

If we sell our house and a flat we own i think we will be liable at least on the flat, but does anyone know if you can avoid paying it by leaving the country? I have heard you may be able to if you dont return for 5 years. If so do you have to be out of the country when you sell?

Cheers for any info.
We believe, from friends who emigrated to Spain, that if you sell here and invest your money overseas you escape Capital Gains - based on your intention being to live in that country. They sold their house here first - it was a holiday let.

Alternatively, live in the flat for 6 months (or pretend to!) and then you can escape.

You can put the capital gains tax due aside for 3 years before it is due to be paid, by which time they may not know where you are!! Hee, hee.

Best to seek legal clarification tho.
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Old Aug 27th 2006, 9:10 pm
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Default Re: Capital Gains Tax Headache

Originally Posted by Am Loolah
We believe, from friends who emigrated to Spain, that if you sell here and invest your money overseas you escape Capital Gains - based on your intention being to live in that country. They sold their house here first - it was a holiday let.

Alternatively, live in the flat for 6 months (or pretend to!) and then you can escape.

You can put the capital gains tax due aside for 3 years before it is due to be paid, by which time they may not know where you are!! Hee, hee.

Best to seek legal clarification tho.
I think if you live in it for a period it only discounts the last 3 years of CGT and not all of it.

I think your CGT liability depends upon several issues:

Have you ever lived in it (discount this period)
Can you live in it before you go (discount last 3 years AND a further 40K of profit)
Is it in one or both of your names (annual personal CGT allowance x 2 = approx 16K)
When did you buy it - there is indexation/taper relief based upon when you bought it
Subtract any improvement works that you have receipts for

this site has some info if you pan downwards to the bottom

http://money.uk.msn.com/Mortgages/Bu...umentid=143721

This should enable you to avoid most if not all CGT liability
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