When considering selling a holiday let, it may be worth taking financial advice to identify any liabilities and opportunities in your personal circumstance before proceding.
Capital Gains Tax (CGT) is applicable on the profit, less the cost of improvements and redevelopments to the property, made from the sale of a property and charged at 18%. There are a number of reliefs available in certain situations, such as if part or all of the property has been used as the main family residence in the past three years and Private Residential Letting Relief which can be worth up to £40,000. There is also relief on the first £10,100 of CGT liability for each tax payer, so if the holiday let is owned by a couple, you can claim £20,200.
Because everyone’s tax situation is different, it is best to take advice and be aware of the options and liabilities before placing the house on the market. Choose an accountant or financial advisor who is familiar with how the rules and reliefs apply to second homes and holiday homes.
