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How the gain is worked out
You pay Capital Gains TaxCapital Gains Tax: Tax on the profit when you sell or dispose of an asset that has risen in value. On shares it is 18% or 24% in 2026/27, charged only on gains above the annual exempt amount. on the gain, not the full sale price. Deduct your allowable costs - the Stamp Duty you paid, solicitors' and estate-agent fees, and money spent improving the property (an extension), but not repairs or maintenance such as painting or a new boiler. That line is HMRC's, set out in manual CG15150.
The first £3,000 of total gains in the year is tax-free (the annual exempt amountThe Capital Gains Tax allowance: the slice of gains you can realise each tax year before any CGT is due. It is £3,000 for 2026/27 and cannot be carried forward if unused.). Residential property is taxed at higher rates than other assets: 18% on gain that falls in your unused basic-rate band (income under £50,270) and 24% above it.
Your main home: Private Residence Relief
If a property was your only or main home for the whole time you owned it, Private Residence ReliefPrivate Residence Relief: The relief that exempts the gain on your only or main home from Capital Gains Tax - for the time you lived there plus a final period (9 months, or 36 if disabled or a long-term care-home resident), apportioned over your total ownership. exempts the entire gain. The complexity - and the gap most calculators skip - is what happens when it was your home for only part of the time.
The exempt slice is the period you lived there plus a final period of ownership, divided by the total months you owned the property. Once the property has been your only or main home at some point, that final period qualifies for relief even after you have moved out. It is 9 months in the normal case, and 36 months where the owner is disabled or living in a care home (see below):
exempt fraction = (months as your main home + 9) ÷ total months owned
Owned a flat for 10 years, lived in it the first 6, then let it for 4? The 6 years plus the final 9 months - 81 of 120 months - are exempt, so only about a third of the gain is taxable before your allowance.
The final period is 36 months, not 9, if you are disabled or in care
Almost every guide and calculator states the final period as 9 months without qualification. There is a statutory exception. Under section 225E TCGA 1992 the final period is 36 months where, at the date of disposal, either:
- you are a disabled person or a long-term resident in a care home, and you have no other relevant right in relation to a private residence; or
- your spouse or civil partner is, and neither of you has any other relevant right in relation to a private residence.
Two definitions do the work. A long-term resident is someone who has been, or can reasonably be expected to be, resident in the care home for at least 3 months. A relevant right means an interest in another dwelling that would itself qualify for Private Residence Relief - so owning other assets, or a property that could never be a residence, does not disqualify you.
The difference is not marginal. On a £100,000 gain over 10 years with 6 years of residence, the standard 9-month period exempts £67,500; the 36-month period exempts £90,000. Select 36 months in the calculator above to apply it. HMRC sets out the qualifying conditions in CG64986.
What this calculator does not do
It apportions Private Residence Relief by time, which covers the large majority of cases. Three things it deliberately leaves out, because getting them right needs facts a calculator cannot sensibly ask for:
- Lettings relief - see below. It now needs a shared-occupancy apportionment of the property itself, not just of time.
- Deemed occupation. Some absences still count as residence: up to 3 years for any reason, up to 4 years where your work forced you to live elsewhere, and unlimited time working abroad - each conditional on having lived there before and, usually, returning afterwards (s.223(3) TCGA 1992).
- Job-related accommodation and the 24-month delay allowed while a home is being built or renovated.
If any of those apply, your exempt period is longer than the figure above. Read HMRC helpsheet HS283 or take advice.
Lettings relief: the rule that changed
Plenty of former landlords still expect up to £40,000 of lettings reliefA Capital Gains Tax relief on a former main home that was let. Since April 2020 it applies only where you shared occupancy with the tenant (e.g. a lodger), capped at £40,000.. Since 6 April 2020 it is far narrower: it applies only where you shared occupancy with your tenant - a lodger in the home you were living in. If you moved out and let the whole property, you almost certainly no longer qualify (HMRC CG64710).
For these reliefs worked through end to end with the arithmetic shown - the 18%/24% band split, the apportionment fraction and inherited base cost - see our guide on how to calculate CGT on property.
Inherited or gifted property
Your base cost is the market value when you acquired it, not what the previous owner paid. For an inherited property that is the probate value at the date of death, so your taxable gain is only the growth since then - which often turns a frightening-looking sale price into a modest bill.
Reporting and paying
If CGT is due on a UK residential property you must report and pay it within 60 days of completion, through HMRC's "Capital Gains Tax on UK property" account - separate from normal Self Assessment, and easy to miss. Non-residents must report every UK property disposal within 60 days, even when no tax is due. The full walkthrough is in our 60-day CGT reporting guide. For gains on shares and funds, see the CGT on shares guide and the shares CGT calculator.