I own one property which I lived in for a year and a half until I moved in with my girlfriend, who also owns her own house. I have been renting out my property for around two years and am now looking to sell. My partner and I are not married or in a civil partnership and both own our own homes independently and therefore only own one house each. Will I need to pay capital gains tax when I sell my property? As it is my only home, I believe that I shouldn’t have to.  

Arthur Weller replies:  

It appears that you have owned your property for three and a half years. Let's make an assumption that you bought your property for £300,000 and you sell it today for £370,000, so that the gain per year is £20,000. The first year and a half that you occupied it is exempt (£30,000), and the last nine months of ownership (final period exemption) (£15,000) is exempt. Using our made-up figures, you have exemption of £45,000, leaving £25,000 subject to capital gains tax, corresponding to the middle year and a quarter. The longer it takes you to sell, the greater will be the middle period.