CGT planning for a beginner.

[shedbones]

Just trying to plan ahead and work out PRR if we sell in 5 years and a 10 year calculation also..... Have I got my head around capital gains tax?

Married couple, bought our flat in Sept 1993 for £40K. It's probably now £150k. Gain of £110K

Have been letting it since November 2011 and intend to continue to do so.

Moved out August 2011 so period of occupation (by August 2014) = 215+36 months, total 251 months.

Calculation in 5 years time from now 251/275 =.913 x £110,000 = total PRR £100,430

Calculation in 10 years time from now 251/335 =.749 x £110,000 = total PRR £82390

Sell in 5 years time (I know the value of the flat won't be the same) and have £9570 CGT before both our personal allowances and letting relief, taking CGT due to zero.

Sell in 10 years time and have £27610 CGT, the above allowances again taking it to zero.

(Please do forgive me if my figures are out)

Have I got the right idea or am I just being hopeful?

[Telometer]

Looks about right. I haven't checked any of your numbers, but you could pay an accountant to do so.

[Gordon999]

I think you are not hopeful enough. After 10 years I would expect the flat value to rise by 3 % per year and gain 30% higher value.

But if the lease term falls below 82 years, then you may have to consider switching to another property.

[shedbones]

Okay, thanks both - that looks like good news.

We were able to extend the lease last year from 73.5 years up to 163.5 years at a total cost of £10300 (including all costs involved), so we'll be okay on that front.

Again, thanks for your help.