I bought a property for £235,000 in 2013. I'm hopefully selling the property soon for about £325,000.

I lived in the property between 2013-2015. During this period the property grew in value to £300,000.

Over the next 4 years, I rented the property. The property has only grown in value £25,000 during this period.

Can I pay tax on only the £25,000? or do I have to spread the overall growth of the property equally amongst periods of residency and rental?


Can I pay tax on only the £25,000?

No. you can claim some relief on CGT but you don't get to specify what gains occurred in what years.

You get relief on a proportion of overall capital gain based on the ratio of time that was your main home to total years owned.

You can't get relief on more than one property.

See https://www.gov.uk/tax-relief-selling-home/y/yes/no/no/yes


I will add to the answer by @RedGrittyBrick that if you lived in a house, you get 18 months of exemption from capital gains tax "for free". So if you live in a house for 6 months, you are exempt from capital gains tax for a proportion of 2 years of the time you owned the house, for example.

I will also add that if you complete before the end of this tax year (5th of April 2019), I think you qualify for Lettings Relief as you have lived in the house yourself as well has having let it out.

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