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PPR Relief question related to spouses

PPR Relief question related to spouses

As I understand it, spouses or civil partners living together can only have one main residence between them.  Does this apply regardless of which of them owns the property concerned? 

My client has been married for a number of years to his second wife and lives mostly with her in her own home. He still owns and maintains his own previous marital home for his now grown up children and also lives there part time during the week for work purposes. They each therefore own one separate property.

Does the wife's home therefore become his main residence by default even though he does not have an financial interest in it?

Appreciate any answers!

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07th Mar 2016 17:22

As a married couple they can only have one PPR

In the absence of an election to determine the position it will be down to the facts which that is, his original house that he uses during the week, or her's being the current marital home.

I would say that in all probability it is the latter, and he has a potential liability on the former marital home, but it might be arguable that it is his original property - though that will leave W2 with an issue on her house.

 

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By SueJ
09th Mar 2016 14:55

As a married couple they can only have one PPR

Thanks for your response.

The current marital home comes with W2's office/job, ie. it's not owned by either of them , so no CGT issue there.

 

 

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09th Mar 2016 14:59

Still a residence (possibly)

SueJ wrote:

The current marital home comes with W2's office/job, ie. it's not owned by either of them , so no CGT issue there.

That does not stop it being there residence necessarily. However, the new fact that it is job-related may change the analysis, depending on the exact basis of occupancy.

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07th Mar 2016 17:26

TCGA s222 (6)(a)  - in the

TCGA s222 (6)(a)  - in the case of an individual living with his spouse or CP there can only be one residence or main residence for both, so long as living together and, where a notice under section (5)(a) affects both, it must be given by both.

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By SueJ
09th Mar 2016 15:02

TCGA s222 (6)(a)

thanks for your reply

does that mean that a 'main residence' is literally where someone mainly resides regardless of whether it is owned by either resident or not?  In this case, the husband owns the former marital home (W1) but now lives mainly with W2 in a property that neither of them owns. He wants to sell his existing property in order to buy a new property for them to own jointly when W2 retires. Sounds like it may be his only property at present, but no longer his main residence?

 

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09th Mar 2016 16:21

Yes. A person's only or main residence (as a matter of fact) may be a rented property. If they then had another property that they owned and which they also used as a residence, then they might make an election for that property to be treated as their main residence.

If W2's accommodation is occupied under a service occupancy though it does not count as a residence and your chap might be deemed to be occupying the old house by virtue of section 222(8A)-(8D). See: http://www.hmrc.gov.uk/manuals/cgmanual/CG64555.htm

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