Q.1 What figure is used for calculating capital gains tax?
I have owned a property for 35 years and still have a mortgage on it. I initially paid £30,000 for the property, but around 25 years ago I remortgaged £60,000 to free up some capital. I started to rent out the property around 20 years ago. If I were to sell the house now (e.g., for £70,000), would the capital gains tax (CGT) be based on the initial purchase price, or would it be from the remortgage or outstanding balance?
Arthur Weller replies:
The CGT calculation is based on the initial purchase price. The mortgage is not relevant for CGT purposes.
Welcome to the AccoTax Help Centre
Search for answers to your questions by entering keywords below, or scroll down to look through our knowledge base.
What Figure is Used for Calculating Capital Gains Tax?
Updated on October 7, 2024
