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PPR exemptions and NRCGT/CGT

PPR exemptions and NRCGT/CGT

I purchased a residential property in mid-April 2014 a few weeks after ceasing to be tax resident in the UK since when it has been unfurnished and unoccupied so has not been anyone's residence. It is my only UK property.

I am not in any form of employment but submit SA returns and am considering whether to visit the UK in 2016/17 when I'll spend just over 90 nights at the property and qualify it through the 'day-count test' as my UK PPR for that tax year. I will have no UK ties whatsoever until I do that. By the date I leave the UK it will have been refurbished and I'd plan to let it. I assume that passing the 'day-count test' also qualifies it for the 'final period exemption' rather than, perversely, other tests being applied instead (such as whether there was an 'expectation of continuity') to establish whether that occupation counts as use as a "residence".

Firstly, would I only need to claim for it to be treated as my PPR for the whole 12 months of 2016/17 at the time of submitting some form of CGT return?

Secondly, if for some reason I cease to be NR and return to live in the UK in that property but subsequently dispose of it, would I - per TCGA92/S223(3)(a) - be able to claim it as my PPR for the three years "period of absence" following the end of the 2016/17 tax year OR for a three-year period following the end of my physical occupation of it? In other words, if it qualifies as my PPR for the whole of 2016/17 under the 'day-count test' then would I still have all of the 'up to 3 years absence for any reason' available to count against the subsequent period (until returning to it as my de facto PPR) as if it were my PPR?

Falling out of those questions, it's not clear to me whether counting the whole of 2016/17 as subject to PPR relief only applies to NRCGT whereas moving back into scope of UK-resident CGT means that, instead, only the actual period of occupation in 2016/17 qualifies for PPR relief. Observations, corrections and pointers would be welcome.

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09th Mar 2016 14:19

NRCGT - tax for non-resident's UK residential property
It's not your residence yet, as it is not resided in by you.You can make a PPR disclosure in your tax return, so once [if there is any doubt whether this is the case] you are residing in it, I suggest you note this in the next tax return after so residing there.   HMRC would be pleased to know your current address anyway, so you can do this by letter.The answer to your Second point is Yes, I think.   The three-year absence test can be used, once you have established your period of residence in 2016-17 i.e. it would relate to a subsequent period, not the preceding period.PPR relief does not, I think appear in almost any NRCGT calculation, unless there is a period of post-March-2015 occupation here.    Thus a sale made whilst abroad is fully taxed, but any post-2017 absence might be a valid absence under section 223. The absence from 2014 looking forwards is not a claimable absence.

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09th Mar 2016 14:32

PPR - last 18 months - claim PPR relief

Sorry take that back.  Point 4 above.   Prior occupation say in 2012 or 2011 or whenever as a Main residence enables you to claim the last 18 months, in any event, as PPR relief upon the eventual disposal or sale. Section 223[2] applies.

28% NRCGT will thus be due to that extent, for those who sell their prior main residence after October 5th 2016, whilst still living abroad.

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