My mate wants to sell his house to move up the property ladder and buy another. will he have to pay capital gains or not if he reinvests it into another house ? help :help:

If it is his only house ...... no.

...and if it not his only house, yes.

Unless he's had the second house less than a year as there is a concession for "overlapping" ownership of 2 homes.

...and if it not his only house, yes.

Not necessarily.

It is possible to claim that the houses being sold and bought are the primary residences (say the other is let to tenants?) and not pay capital gains on this sale.

You cannot change your mind however when you come to sell the second house, though.

Could you expand on that please? How can more than one house be a primary residence other than if there's an overlap between moving as I mentioned above?

You can have two houses and sell them without paying capital gains tax.

First you sell the one you're living in - no CGT because it's your primary residence. Then you move into your second house and sell that. No CGT to pay because you lived in it so it then became your primary residence.

So on that basis you could buy any number of houses and live in each one for a while before selling? Sounds a bit too big a loophole for grabbing Gordon not to pick up on on.

It's been a loophole for a while, my dad was just telling me the other day about his builder friend who has been doing this for 20 years, only building one house at a time obviously and then moving into it.