Private Residence Relief help

Private Residence Relief help

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My client owns two properties. One (property 1)  bought 17 years ago, lived in for six months and then rented out. The other (Property 2) bought more recently and lived in throughout period of ownership.  The client is selling both properties.  He plans to sell Property 2 first and as it has been his PPR throughout the period he has owned it use Private Residence Relief on e whole gain.  He then proposes to move into Property 1 for the period until it is sold, which he hopes will be fairly quick.  Property 1 is then his only property.  Will the last 18 months of that property also be relieved from Capital Gains Tax if this is done?  Does he have to make an election?

Really appreciate any help.

Thanks

Claire

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Euan's picture
By Euan MacLennan
14th Jan 2014 10:17

Two questions, so two answers
Yes - the last 18 months of ownership (assuming the sale is after 5 April 2014) will be treated as a period of residence, regardless of whether he moves back in or not, since it was his PPR for the first 6 months of his ownership.No - an election is between two residences, but he has only one.  Property 2, while Property 1 is being let, and then, Property 1 after Property 2 is sold.

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