In the Chancellor’s Autumn statement, changes were announced to Capital Gains Tax Private Residence Relief.
Currently, if a property is an individual’s private residence, it is exempt from CGT under the Private Residence Relief. This Relief is extended for three years after the property stops being your private residence, for example because you relocate but don’t immediately sell your house. However, from 6th April 2014, this exemption period will be reduced to just 18 months. This will make it more difficult for property owners to obtain Private Residence Relief against a property that is no longer their main residence.
If you have a property that used to be your private residence, you should give serious thought to selling before 6th April 2014 in order to maximise the Relief available.
If you would like more information about property and capital gains tax please contact us.