Scenario - Mr and Mrs A are selling their rental property. Property has been owned for 15 years, was their PPR for 12 years and let for 3.
At some point in these 12 years of PPR the adjacent field (I believe around 3 acres) was purchased to change the nature of the home into an equestrian-based small holding. Will this satisfy the use and enjoyment rules? I'd like to think so but feel uneasy about it.
The property has now been sold and if we were to take the land out of the equation completely the PPR and letting relief mitigates the CGT liability completely before using the annual exemption. But, it has now transpired that only part of the land has been sold with the property, the rest they are keeping for themselves.
I'm not looking for calculations but can someone explain how this will affect the CGT calculations? Does the land have to be removed from the PPR calculations completely/do the part-disposal rules apply?
Thanks for any comments.
PS I am not submitting this return but I work with the Mr and he is asking advice!