Non-dom PPR query

Non-dom PPR query

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This has been touched on in previous questions however opinion appeared to be very divided in relation to whether an election is required where a second property is rented, and I have been left a little confused.

The scenario is that a non-dom sold their Spanish property last year. In the process of computing the capital gain (which included a rather large forex gain due to the movement in exchange rates), the client has asked me to treat the Spanish property as their PPR. The client (of Spanish origin) is resident but non-domiciled in the UK for tax purposes, and rents a property in the UK which he uses as a base between "travelling" and spending time in Spain with family. When in Spain he resides in his Spanish house which is never let out and maintained for his sole use. The client is currently submitting tax returns on an arising basis.

So he doesn't own the UK flat but from my understanding of HMRC guidance it would appear that he has an interest in the flat as a tenant, and therefore unless an election is made HMRC could treat the UK flat as his PPR with the result that PPR relief cannot be claimed on the Spanish house. Should therefore a late election under ESC/D21 be made (the Spanish property was bought over 6 years ago)?

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