Tax guide · 11 min read
Capital Gains Tax when selling a UK house — the complete guide for 2026/27
Selling a home you have always lived in usually means no Capital Gains Tax at all. Selling a rental, a second home or an inherited property usually does. This guide sets out exactly which rules apply, what you can deduct, and when HMRC needs to hear from you.
Last verified 6 September 2026 against the official publications listed below.
On this page
- 1. Do I pay Capital Gains Tax when I sell my house?
- 2. What are the Capital Gains Tax rates on residential property in 2026/27?
- 3. How does Private Residence Relief work?
- 4. Can I still claim lettings relief?
- 5. What costs can I deduct from the gain?
- 6. When do I have to report and pay?
- 7. How can I legally reduce the bill?
Do I pay Capital Gains Tax when I sell my house?
Capital Gains Tax (CGT) is charged on the gain you make, not the price you sell for. If the property has been your only or main home for the whole time you owned it, Private Residence Relief normally covers the entire gain and there is nothing to pay and nothing to report.
You are likely to have tax to pay if the property was a buy-to-let, a second home, a holiday home, a property you inherited and did not live in, or a home you let out for part of your ownership.
What are the Capital Gains Tax rates on residential property in 2026/27?
Residential property has its own CGT rates, higher than the rates for other assets. Which one you pay depends on where the gain sits when it is stacked on top of your income for the year — so a single sale can be taxed partly at 18% and partly at 24%.
| Your position | Rate on the residential gain |
|---|---|
| Gain falling within the basic rate band | 18% |
| Gain falling above the basic rate band | 24% |
| Annual exempt amount (tax-free slice) | £3,000 |
| Basic rate band | £37,700 above the personal allowance |
Figures verified from HMRC — Capital Gains Tax ratescheck the source
- Basic rate band
- 18%
- Higher rate band
- 24%
- Annual exempt amount
- £3,000
On the slice within your basic rate band
On the slice above it
Tax-free slice of the gain
Transcribed from HMRC published rates. Share this summary — the figures are the official ones.
Your figures
Purchase and sale prices, costs, improvements, occupation months
HMRC rates
Published bands, reliefs and the annual exempt amount
The workings
Relief applied, exempt amount deducted, rate split calculated
= Tax due, with every line shown and each figure traceable to its source
Our calculator applies these bands to your own figures and shows the workings line by line.
Work out my CGT with HMRC rates →How does Private Residence Relief work?
Private Residence Relief (PPR) removes the part of the gain that relates to the period the property was your only or main home. It is worked out in months: months of qualifying occupation divided by total months of ownership.
The final 9 months of ownership always qualify if the property was your main home at some point — so you are not penalised for a slow sale after you move out.
Can I still claim lettings relief?
Lettings relief still exists but since April 2020 it only applies where you shared occupation of the property with your tenant. It is capped at the lower of the PPR already given, the gain attributable to the letting, and £40,000.
If you moved out and let the whole property, lettings relief is not available — a change that catches out a lot of accidental landlords.
What costs can I deduct from the gain?
- Stamp Duty, LBTT or LTT paid when you bought
- Solicitors' and surveyors' fees on both the purchase and the sale
- Estate agent fees and marketing costs
- Capital improvements — an extension, a new kitchen where none existed, a loft conversion
- Costs of establishing or defending your title
Repairs and redecoration are not deductible against the gain — they are maintenance, not improvement. Anything you already claimed against rental income cannot be claimed again here.
When do I have to report and pay?
A UK residential property disposal with tax to pay must be reported and paid within 60 days of completion, through HMRC's 'Capital Gains Tax on UK property' service. The Self Assessment return later in the year does not replace that deadline.
Answer a short set of questions and compare selling as you are, transferring a share, claiming reliefs, or completing in the next tax year.
See every legal route to reduce the bill →How can I legally reduce the bill?
- Use both annual exempt amounts by transferring a share to a spouse or civil partner before exchange — transfers between spouses are on a no gain, no loss basis
- Claim every allowable cost, including the Stamp Duty you paid on purchase
- Offset capital losses from the same or earlier years
- Check whether any period of absence still counts as occupation, such as working abroad
- Consider the timing of completion where a gain would otherwise cross a tax year
In summary
- Main home throughout your ownership: no CGT and nothing to report.
- Residential rates are 18% and 24% after a £3,000 exempt amount.
- Report and pay within 60 days of completion.
- Keep every purchase, improvement and sale invoice — they reduce the gain.
People also ask
Do I pay Capital Gains Tax if I sell my only home?
Normally no. Private Residence Relief covers the whole gain if the property was your only or main home throughout your ownership and the garden is within permitted limits.
How much is Capital Gains Tax on a second home?
Residential gains are taxed at 18% within the basic rate band and 24% above it, after the annual exempt amount of £3,000.
What is the 60-day rule?
A UK residential property disposal with CGT to pay must be reported and paid within 60 days of completion using HMRC's CGT on UK property service.
Do I pay CGT on an inherited property?
Inheritance Tax may apply to the estate, but for you the base cost is the probate value. CGT is charged on any increase between that value and the sale price if you did not live there as your main home.
Can I deduct the estate agent's fee?
Yes. Estate agent fees, legal fees and marketing costs on the sale are allowable, as are the legal fees and Stamp Duty on your purchase.
Is a new kitchen an improvement or a repair?
Replacing a kitchen like for like is a repair and not allowable. Adding something that was not there before — an extension, an extra bathroom, a loft conversion — is a capital improvement and is allowable.
Do I still pay if I make a loss?
No tax is due on a loss, but report it so it can be set against gains in the same year or carried forward.
What happens if I miss the 60-day deadline?
HMRC charges a late filing penalty and interest on the unpaid tax. File as soon as you can — the penalty grows the longer the return is outstanding.
Do non-residents pay CGT on UK property?
Yes. Non-residents must report a UK property disposal within 60 days whether or not there is tax to pay.
Does transferring to my spouse avoid the tax?
It does not remove the gain, but it can use a second annual exempt amount and a second basic rate band. The transfer must be genuine and made before exchange.
Now calculate it
Free, uses published HMRC rates, and shows every line of the calculation.
Calculate my Capital Gains Tax →Official sources
Every figure in this guide is transcribed from these published pages. Always confirm against the source before filing or signing anything.
- Capital Gains Tax rates — GOV.UK
- Tax when you sell your home — GOV.UK
- Report and pay CGT on UK property — GOV.UK
Guidance only. mypropclear explains published rules and how they apply to figures you provide — it is not personalised tax or legal advice.
Common questions people asked after reading
Do I still pay if I make a loss?
No tax is due on a loss, but report it so it can be set against gains in the same year or carried forward.
What happens if I miss the 60-day deadline?
HMRC charges a late filing penalty and interest on the unpaid tax. File as soon as you can — the penalty grows the longer the return is outstanding.
Do non-residents pay CGT on UK property?
Yes. Non-residents must report a UK property disposal within 60 days whether or not there is tax to pay.
Does transferring to my spouse avoid the tax?
It does not remove the gain, but it can use a second annual exempt amount and a second basic rate band. The transfer must be genuine and made before exchange.
