I have owned property A since May 2002 and lived in it until…

Once you moved out of property A and let it, it ceased to be your main residence.

As you have lived in property B for the entire period of ownership when you sell it the gain will be exempt from CGT.

Now back to property A. The gain for the period it was your main residence which is defined by you living in it will be exempt from CGT as will the gain for the last 36 months of ownership which the tax authorities give you free. So, in October 2009, you will have reached 36 months since you moved out of property A. If you move back into Property A in, say December 2009, and sell in, say March 2010 you will have the following situation:

May 2002 to November 2006 Gain exempt due to owner occupation (55 months)

December 2006 to November 2009 Let so gain taxable (36 months)

December 2009 to March 2009 Gain exempt due to owner occupation (4 months)

The total period of ownership will be 95 months and you can divide the gain by that figure. The gain for the first 55 months of ownership will be exempt as will the gain for the last 36 months of ownership. That leaves the gain for 4 months as potentially taxable but as you both lived in the property and let it you will be entitled to a further deduction called letting relief which is the lesser of :

1 £40,000.

2 the exempt gain for 91 months and

3 the taxable part of the letting period gain which is 4 months

You are unlikely to have to pay CGT on the sale of property A.