close menu

New changes to tax legislation from 6 April 2014

by Sable International | Mar 14, 2014
  • Changes to reliefs that will help reduce your Capital Gains Tax bill for the non-business portions of your rental property will be implemented on 6 April.

    The new reliefs will help reduce your Capital Gains Tax bill for the non-business portions of your rental property. These reliefs include:
    • Exemptions for the period of time you lived in that property as your main residence.
    • A tax reduction for the period of time that the property was rented, which recognises that the income was taxed as a rental business (Letting Relief)
    • An exemption for the final three years of ownership. 
    These reductions to the capital gains subject to tax are all available, provided that the property was classed as the owner’s only main residence at one point in time. 

    From the 6th April, the latter of these reliefs will change. Instead of the final three years of ownership being exempt from tax (regardless of whether the owner lived there during those last three years), this will be halved to the final eighteen months instead. 

    For example, if a property that cost £200k 16-years ago was recently sold for £800k and was lived in for 1,000 days and rented out for the remainder, the following reliefs would be available:

    • £100k for the period of time that the owner lived in the property
    • £40k for letting relief (the lower of the gain, £100k residence relief, or £40k)
    • £113k for the final three years of ownership 
    • £10,900 for the Annual CGT Exemption.

    The owner would have a chargeable gain of £336k taxable at 28%. However, if the sale was completed after the 5th April, the third relief would be halved. That would mean an extra capital gain of £56k and additional tax to pay of £16k.

    Therefore, if you are in the process of selling a property which you have not lived in for the entire time you owned the property – and for which you will be entitled to Principal Private Residence relief – it would be in your best interests to see that the contracts are exchanged by 5th April and not a day later.

    Our accounting team are specialists in bookkeeping, accounting and financial management practices for small-to-medium sized enterprises.

    We are a professional services company that specialises in cross-border financial and immigration advice and solutions.

    Our teams in the UK, South Africa and Australia can ensure that when you decide to move overseas, invest offshore or expand your business internationally, you’ll do so with the backing of experienced local experts.

    • business plan
      Step-by-step guide to writing a business plan [template included]
      Aug 29, 2019  |  by Scott Brown
    • female-entrepreneur hot air balloon
      Why we need more women-owned businesses
      Jul 16, 2019  |  by Scott Brown
    • crowdfunding lightbulb
      7 ways to finance your small business
      Jul 16, 2019  |  by Scott Brown
    • Businessman looking to the future
      How to get your business ready for the future
      Jun 19, 2019  |  by Scott Brown
    • Guide to UK PAYE tax forms
      A guide to UK PAYE tax forms P45, P60 and P11D
      Jun 14, 2019  |  by Kobus Van den Bergh
    • Cut-taxes
      The 2019/20 tax year changes: What they mean for you
      Jun 10, 2019  |  by Scott Brown
    • confused
      Do you need to complete a Self Assessment tax return?
      May 29, 2019  |  by Kobus Van den Bergh
    • Tax refund money
      11 excellent ways to spend your UK tax refund
      Apr 09, 2019  |  by Kobus Van den Bergh
    • London-business
      The UK still the best country for business in 2019
      Apr 04, 2019  |  by Scott Brown
    • Contractor choosing door
      Contractor insurance: Choosing the right cover for your risks
      Mar 12, 2019  |  by Kobus Van den Bergh

    South Africa

    Cape Town

    Regent Square
    Doncaster Road
    Kenilworth 7708 +27 (0) 21 657 2120


    25 Richefond Circle
    Umhlanga 4320 +27 (0) 31 536 8843

    United Kingdom


    One Croydon
    12-16 Addiscombe Road
    Croydon CR0 0XT +44 (0) 20 7759 7514



    9 Yarra Street
    South Yarra
    VIC 3141 +613 (0) 8651 4500

    Sable International is a trading name of 1st Contact Money Limited (company number 07070528), registered in England and Wales. We are authorised and regulated by the Financial Conduct Authority in the UK (FCA no. 517570), the Financial Services Conduct Authority in South Africa (1st Contact Money [PTY] Ltd - FSP no. 41900) and hold an Australian Financial Services Licence issued by ASIC to deal in foreign exchange (1st Contact Group - AFS Licence number 335 126).

    We use cookies to provide the best website experience for you. Using this website means that you agree to this. How we use cookies.