From: Ronald Raygun 
Subject: Re: Capital Gains Tax Advice
Newsgroups: uk.finance
Date: Sat, 17 Feb 2007 19:31:30 GMT

le Man wrote:

>> Yes, except lettings relief is only available if you have lived in the
>> house. Then there would be an exemption as well.
> 
> Ok thats a bit of a pain, but probably not that relevant in the long term.

What long term?  "The tenant now wishes to purchase..." sounds as though
you don't have a long term to play with.  If you don't make up your mind
soon you could lose your ideal buyer, and if the price is right, a tenant
buyer is about as good as it gets.  No redecorating prior to marketing.
No marketing, hence no estate agency fees, though you will want to get an
independent valuation done and to engage a conveyancing solicitor.

Should you not sell to the tenant now you could wait till they move out to
elsewhere or you could kick them out, make it a second home for yourselves,
and nominate it as your PPR, thus knocking a huge hole in your CGT bill
(at the expense of knocking a small dent in the 100% PRR for your real
home).

The snag with this plan is again that you would first lose your ideal
buyer and may not find another buyer easily.  There again you could get
lucky.  But there's all the hassle of redecorating and marketing.

[For "you" read "your in-laws"]