Capital Gains Tax

[stephporter]

We purchased a derelict property around 2 years ago, we then sold our home to purchase the derelict house, we lived for a short period of time in the garden of the derelict property in a caravan, whilst applying for planning permission.  We then had a new baby and during the winter months we decided to rent a small house locally due to having a new born baby.  We have since got planning permission but our circumstance have changed and we want to sell the property, and then purchase a normal family house. Are we to pay CGT?, as we genuinally purchased the derelict house with the purpose of a family home, not as an investment.

[zmudge]

If it can be stated that the derelict house/caravan was your principal residence which subsequently became uninhabitable such that you had to move into temporary accomodation and that you are now unable to make your prinipal residence inhabitable and must therefore sell it then it does not fall for CGT.

With compliments zmudge