I am looking to sell a property this year. I have owned it for eleven years in March 2020 and lived there for just over eight years. I moved out in August 2017 when I began to rent it out and moved in with my partner. I don’t own any other property. I moved back there in March this year when my tenants moved out. What is my capital gains tax (CGT) position?

Arthur Weller replies:
If you sell the property before 6 April 2020, you will get 18 months final period exemption for principal private residence relief purposes, plus the lettings exemption. To calculate the capital gain, deduct the original cost from the sale proceeds. Divide this figure by 11, to find the gain per year. The first eight years are exempt because you lived there. The last 1.5 years are also exempt, as above. The gain attributable to the ‘middle’ 1.5 years can be reduced by the lettings exemption, which cannot be more than £40,000. Then deduct the CGT annual exemption, currently £12,000. It is quite possible that you won’t have any CGT to pay. If you exchange contracts after 5 April 2020, you will have only nine months final period exemption and no lettings exemption.