Private Residence Relief - still partially resident

Are in a long term relationship. Neither are married, nor in a civil partnership etc. and they have no children. Both own their own homes, which have been family homes (Jo completed 25 year mortgage, and Sam’s was gifted). Neither have ever been let and nobody has ever paid rent (no lodgers). Over the years, Jo has been spending more and more time at Sam’s and has gradually been using Sam’s address to register with various agencies (including voting, some bank accounts, cars, etc.); - these registrations happened very gradually and were many years apart (and often done for privacy reasons). Jo still utilises the original house as a home, which contains bed, bath (only a shower at Sam’s), clothes, TV and console, hi-fi system, photographic and darkroom equipment, hobbies, etc. and Jo is usually present here 5 to 6 days every week, but rarely sleeps there. (This address is also used for some bank accounts and other minor registrations). In addition, Jo pays the utility bills and does all the maintenance and repairs etc. Jo does not pay any of the utility or food bills at Sam's house. Jo’s last sibling has now moved out, and Jo wants to sell the house (and completely move in with Sam). Would CGT be payable in these circumstances ? Thanks.

Hi,
 

You are entitled to full Private Residence Relief where each of the following conditions are met: - the dwelling house has been your only or main residence throughout your period of ownership  -you have not been absent, other than for an allowed period of absence or because you have been living in job-related accommodation, during your period of ownership . - the garden or grounds including the buildings on them are not greater than the permitted area -no part of your home has been used exclusively for business purposes during your period of ownership —working from home using a room that is also used for non-business purposes will not prevent entitlement to full relief.    Based on the information provided, you have met each of these conditions. You would therefore be entitled to full Private Residence Relief, and no CGT would be payable on the sale of your home.     See Link: HS283 Private Residence Relief (2021)  . Thank you.

to HMRCAdmin17, thank you for your help. kind regards, Jo

to HMRC Admin17, Upon reflection, may I please ask for some further clarification. Given the circumstances as originally described: Jo is "residing" to some extent at both premises, and, whilst clearly still considering the original family house as "home", has been spending more and more time/nights at Sam's house. In these specific circumstances, does there ever become a tipping point where Jo can no longer count on the original house being regarded as the primary residence for CGT purposes, or can Jo always count on this being the case (providing their marital status etc remains the same). Is this ability to nominate a property as primary residence relevant here ? thank you.

Hello jo stones

It would then be based on fact. Please take a look at the guidance at
CG64545 - Private residence relief: two or more residences: no valid notice made

Thank you

Thank you Admin5, After following CG64545, my reading of the situation is as follows, and is based on text in the referenced CG64470 :- "An individual’s only or main residence may be in a home in which they have no interest. Where an individual occupies their main residence under a licence but they also reside in another dwelling-house in which they have an interest, the residence in which they have an interest will be the only or main residence for private residence relief. This is because the word residence within s222 TCGA92 only refers to residences in which the individual owns an interest." My interpretation of this is 1. As they are not married (etc), Jo has "no interest" in Sam's house; 2. Jo only has an interest in Jo's own house, and therefore, Jo can only claim PRR on the sale of Jo's own property; Does this mean, that for as long as Jo is routinely spending some time at Jo's own property, then Jo will always qualify for 100% PRR ? thanks

Hi jo stones

This could be considered but you would need to write in and apply for this for definitive confirmation to be given.
You would need to provide the facts, mentioned in your earlier questions, in your application and send this to
HMRC
PAYE  & Self Assessment
BX9 1AS

Thank you
 

Hello Admin5 and thanks for your reply, There are guidance notes that state that an individual who is living at a second property, can "nominate" their first property as being the place they reside in for CGT purposes. Could this nomination approach be a more straightforward solution ? And if yes, how is it done ? thx

Hi,

You can find guidance on nominating a home here:

Tax when you sell your home

Thank you.