remortgaging and capital gains tax

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M
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Hi,

The example here is someone, who wants to sell one of their BTL's to use to buy two flats abroad.

Say for instance, you owned a property out right worth 100,000 and you wanted to sell it to buy say,two flats for 40,000 each, rather than selling this property and paying lots of CGT, could you, remortgage the house (80% BTL) use that money to buy the flats. That would leave you with a house with only 20,000 'equity' in the house.

Now sell that house, pay off the mortgage and any CGT on the 20,000 and you've now got rid of the house and paid no CGT.

I understand some people would say its best just to remortgage the house and keep all three, however is the above a viable way to get around CGT?

Regards,

David.

18/10/2006 00:00

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