Do we need to pay Capital Gains Tax on our current house after we move into our self build?

One Answer

1. Katherine Taylor says:

   16th February 2023 at 9:53 am

   Hi Joe,

   If you have occupied the house for the whole period of ownership as your home (no business use), then it should qualify for private residence relief, so there would be no capital gain to pay (there are some restrictions on property size, however). More information is available here:

   https://www.gov.uk/government/publications/private-residence-relief-hs283-self-assessment-helpsheet/hs283-private-residence-relief-2022

   There is a period of nine months automatically applied to allow you to sell your previous private residence. More information is available here:

   https://www.gov.uk/hmrc-internal-manuals/capital-gains-manual/cg64985

   However, I am not a specialist tax adviser, and therefore I would highly recommend seeking professional advice, as there may be considerable sums involved.

   If you choose not to get professional advice, then it’s important to do a lot of research to ensure you understand the complexity of the rules surrounding tax on a property, as there may be a number of factors which haven’t mentioned in your query that would significantly change the advice you receive (such as business use of your home, or buying a property with the intention of making a gain).

   You also need to be sure that you are reading the tax law in place at the time you undertook the transaction, as the law changes regularly.

   Katherine Taylor (Build It’s Finance Director)

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