When considering a self-build home, it's crucial to anticipate capital gains tax (CGT) implications upon selling or gifting the property. Tax relief typically applies if the home served as the owner's main residence; however, various factors like property size, duration of absences, and previous ownership can affect relief eligibility. Expert Ben Taylor emphasizes that CGT is only relevant upon the property's sale or transfer. Additionally, specific circumstances, such as receiving land as a gift, may complicate tax liabilities.
CGT is payable on gains made on a capital disposal, therefore it should only be relevant if the house is sold or gifted.
Principal private residence relief generally applies to relieve any gain on the sale of your main residence, but it is not an absolute relief.
If you were gifted the land and holdover relief was claimed, that can interfere with the availability of PPRR down the line.
It is a good idea to think about whether you might be liable for tax on any gain when the property is sold.
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