You may have decided that you’re over the 4 days of summer delivered by the British climate, or maybe you’re heading to a new a new and exciting career. Either way, you’re taking your chances overseas and moving to a different country.
You may not be planning on coming back anytime soon, so there’s no point leaving behind an empty house, the funds you could secure through selling will help you get comfortable in your new country. However, there’s enough things to worry without the sale of your home being added to your to-do list, so we’re going to talk you through all the things you need to know to sell your home when moving abroad.
Do I have to pay Capital Gains Tax?
In one of our earlier blogs we covered the Capital Gains Tax and what it means for prospective sellers, but what does it mean for those who are wanting to move abroad?
Typically when you’re selling your home, you won’t have to pay Capital Gains Tax providing you can meet the government’s criteria:
- The property has been your main home for the time you owned it
- It was only used by your family and no more than one lodger throughout the time you owned it
- The total area of land doesn’t exceed 5,000 square meters (roughly the size of a football pitch)
Providing you meet this criteria, you will not be eligible to pay CPT, which means more money towards your next adventure. However if, for example, this property was not your main home and you had used it to generate a profit, you would be liable to pay the tax.
The tax is calculated based on the profit you make from the asset, in this case your property. Even then there is a tax-free allowance of up to £11,300 and everything over that is either charged at 10 or 20 percent, depending on the amount earned.
When moving abroad, chances are you’re buying a new property in a country that has a different currency to the UK. This means that unless you have money already in that currency due to savings or wages being paid in that form, then you’re going to have to purchase some with the money you receive from the sale of your house. For example, if your house sells for £100,000 current exchange rates could see you receiving around €115,200.
Exchanges of large amount of currencies can be handled by your bank or other exchange services. One tool has been set up by the Telegraph to help you gauge how much you can expect when the transfer is complete.
The property chain can sound it like would become more convoluted when a home in another country is added. However, the only major difference is the currency exchange and that can be handled by your bank or other similar third party. As long as you can place the required deposit down on the house and secure a mortgage, selling your house and moving abroad is essentially a straightforward process.
Once you’ve sold your house, you won’t have to move out right away. Time is given to ensure you can complete on your next home and have time to move to your new country.
While the idea of completely relocating to another country may seem daunting and impossible, the process itself can be much simpler than you first imagine. The important part is ensuring that you have everything lined up with the house you’re buying so you can quickly transfer the deposit and begin to start your new life out there.Back to all articles