a couple each had their own residence and then they bought one in their joint names, is there any precedent that states that this would automatically be their main residence. I ask because it was knocked down and rebuilt over 2 years and a large gain was made a further 2 years later when they sold after they received an offer they couldn't refuse. I have read Claritax's main residence relief and can't find much about it there. I am also aware that HMRC treats short periods of non occupation after purchase but before moving in as a valid period of ownership see also Higgins v R&C, does anyone have any comments or need further info as I wish to try and reduce the non PPR time. Thanks Nick
Replies (11)
Please login or register to join the discussion.
The easy answer is no, there is no precedent that states that somewhere they were not living (and, presumably, had not previously lived) would automatically be their main residence. More information might help us help you though. Things like whether they're married/equivalent (and when), where they lived (and when), whether they sold the other properties (and when). In short, a timeline of events relevant to PRR (not necessarily limited to those few I have mentioned).
Higgins doesn't help. In that case, the flat was used as a residence as soon as there was a right to occupy. I believe 'occupy' here takes its legal sense, and, legally, your clients occupied Y when they bought it. How else would they be able to knock down one house and build another?
ESC D49? Doubtful, but just possible. Why did the period exceed a year?
Aside from that, you are struggling.
Did they claim PPR on the sale of X? If so then how can Y be the PPR during the entire period of ownership. The earliest would be Dec 14, since, in my view, you would have to look at the facts, so where they actually lived, in the absence of an election.
Edited since I got the X and Ys and A and Bs mixed up.
No. PRR is not a claim. It either applies, or it does not. So I ask again, amend what? On what basis?it was their decision to claim PPR
EDIT: and to what (intended) effect? How does it affect the relief on Y?
You too?
Per https://www.accountingweb.co.uk/any-answers/ppr-on-house-built-for-occup... Justin has a solution for your situation.
I suspect though that his question was hypothetical and his 'solution' available only with a different fact pattern (including - despite his OP - that sale has not yet happened).