Can you get stung by capital gains tax on a second house?

Q My son has a flat in London that he bought for ?80,000 and which is now valued at around ?220,000. He will be moving to the Kent coast in about two years' time. What would be the capital gains tax position if he bought in Kent now, rented it out for two years, and then sold up in London and moved into the Kent house? The profit from the London residence would be used to reduce the mortgage of the new house.

SS

A No problem. Providing the London flat is a personal private residence, your son can sell it without any capital gains tax liability. There is nothing to prevent him from investing in another property and renting it out, although of course he will be liable to pay income tax on the rent money. Once he has moved to Kent that will become his personal private residence and can be sold at a later date without any capital gains tax liability as well.