Capital Gains Tax On House Sale

You may be worried about having to pay Capital Gains Tax on house sale or other forms of property transaction.  Capital Gains Tax is levied on the increase in value of a capital asset (such as a house) when it is disposed of and so can indeed affect the sale of a house or home.  However, there are exemptions and special conditions that may help to mitigate or avoid Capital Gains Tax on house sales entirely:

  • The first £9,200 of capital gains each year is exempt from Capital Gains Tax.
  • Your main residence may qualify for private residence relief, if it qualifies under various conditions such as the size of the grounds, number of outbuildings, and whether any part of the property was exclusively used for business purposes.  If it does qualify, then it is exempt.
  • If you are married or in a civil partnership, then both you and your partner will share the same main residence – you cannot each nominate a separate residence and benefit from tax relief on both of them.
  • Taper relief reduces the tax payable on an asset over time, which may help to significantly reduce Capital Gains Tax on house sale or property sale.

For more advice and information on Capital Gains Tax on house sales, check out the Property Capital Gains Tax Calculator and other property guides on offer in our online Fair Investment Tax Bookshop!

Disclaimer: Every effort is made to keep the site accurate, however please bear in mind that tax rates are subject to change. If you require tax advice you should speak to a professional tax adviser.