Ask the experts: Capital gains tax on property
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I bought a flat with a friend about three years ago for £241k, we lived in the property for about two years and I then bought a property with my girlfriend in May this year, leaving my friend in the old property.
My friend and I are now looking to sell the property for about £385k.
I understand he will not be liable for capital gains tax but I will be? Is this correct? If so can you tell me how much I will have to pay?
- SK, Hertfordshire
I've got good news for you. After a property has ceased to be your Principal Private Residence, the first three years of property price growth are disregarded.
As your friend still lives there, he is not liable for CGT and neither are you because of the three year rule.
Paul White,
Belgravia Insurance Consultants
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