PPR RELIEF

PPR RELIEF

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HMRC are challenging the PPR Relief Claim on sale of property.

Client moved into property for 6 months then decided to rent it out.

They are looking for proof that she established it as PPR

She has given them Electricity bill and council tax bill in her name. She has also offered to give them names of neighbours who could verify that she lived there.

They are saying that as the electricity bill was low it would indicate that she was not living there.

She did not notify her change of address to any other agency as all mail was still going to her parents address next door and this was not a priority at the time.

Because of this they are stating it was a temporay move and PPR not admissable.

Has anybody had experience in defending a claim to PPR. Are there any cases that may assist us. I can only find two cases and both are in favour of HMRC.

One for it being a temporay move and one for not providing sufficient evidence.

Replies (6)

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By George Attazder
30th Jul 2012 13:08

Let me get this straight

Your client was living with her parents. Bought the house next door and "lived" in it with the genuine intention of it being her residence.

Whilst she might have had a camp bed and a gas stove in the front room in order to "live" in it, that wouldn't have made it her residence. Residence involves a certain quality of occupation.

If I bought a new house, with the intention of it being my residence, having previously lived with my parents, whilst my expense probably wouldn't have been lavish, the first thing that I'd have done is had some furniture and white goods delivered. Any evidence of that?

Quote:

She did not notify her change of address to any other agency as all mail was still going to her parents address next door and this was not a priority at the time.

If I'd just bought myself a house and moved out of my parents, quite frankly, I'd have been howling the fact at the moon and shouting it to the whole world. What about electoral registration?

Your facts don't sound like ones that would persuade a tribunal to me.

Incidentally, where did she go to reside after she'd stopped living in her house? If the answer's the parents house, I'd give up now if I were you, you're just running up fees.

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By George Attazder
30th Jul 2012 13:33

My prediction...

... is that you can safely ignore the next post.

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By justsotax
30th Jul 2012 13:24

a bit harsh.....

but not without reason - key points for next time, get ALL of your mail redirected to new home....

 

Did she buy any furniture, fittings etc for the property.....(has she got proof of purchase....are they now in storage).  I presume the mortgage was just standard one rather than buy 2 let (or did she inherit the property).  Were major works required to property before she could more in?

 

Worst case scenario....she will have cgt but she can look at claiming back council tax for the period whilst the property was 'empty'.

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By John - Horler Tax
30th Jul 2012 16:37

You need it to all add up

 

I've defended several claims in the past (and won the large majority) but it isn't easy in the scenario you mention.  How low are the electricity bills?

The hardest successful cases have all involved trawling through bank statements and credit card statements, (after a paymnent in advance from the client) writing to utility and other companies and highlighting expenditures (as others have said) like:

Council Tax

Gas

Electricity

Water Bills

Telephone and internet

House insurance

Furniture and furnishings

Repairs

Just the normal day to day things that people spend their money on down to a change in food shopping habits (after all they now live at their house rather than their parents').

Lost a couple too where the evidence pointed simply to a 'void period' before letting.

 

 

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By Anthony123
30th Jul 2012 19:15

why did she move next door?

was it just good luck it came up for sale?

or have her parents build her a house on part of their garden and given it to her? (or gave her the land and she built it?)

did she have internet connected right away to the house? my recent experience of house moving is that that is the number one priority!

has she any photos from when she lived there? such as social events with friends etc?

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By TaxationPete
31st Jul 2012 13:42

When she moved out where did she move to. When did she first advertise the property for rental. HMRC are much tighter on these activities these days.

Regards Peter

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