CH22 Private Residence Relief (PRR)

Question 1

If a taxpayer sells their only or main residence ?

Answer 1

PRR may exempt all or part of the gain arising.

Question 2

Definition

Define the term ‘private residence’.

Answer 2

The term private residence means a dwelling house and includes any relevant buildings within the curtilage of the main house.

The relief also covers gardens of up to half a hectare (including the site of the house), or larger if required for reasonable enjoyment of the property.

Question 3

Relief

The amount of relief available is: ?

Answer 3

Gain x Period of occupation of property/Period of ownership

Question 4

Deemed Occupation

Occupation includes both: ?

Answer 4

Actual and deemed occupation.

Question 5

Deemed Occupation

What always counts as deemed occupation?

Answer 5

The last nine months of ownership always count as deemed occupation *

* as long as the house was occupied at some point by the taxpayer.

Question 6

Deemed Occupation

Three further types of absence will count as deemed occupation, these absences are: ?

Provided the taxpayer lived in the house at some point before and at some point after the absence.

Answer 6

1. any period when employed abroad;
2. up to four years when working away from home (this includes self-employment);
3. up to three years for any reason.

Question 7

Unable to Reoccupy

If a taxpayer is prevented from reoccupying their home as a result of the terms of their employment, ?

Answer 7

then the requirement to reoccupy the residence in order to ensure the absence qualifies as deemed occupation is ignored.

Question 8

Delayed Occupation

If a taxpayer acquires a house as their main residence but is unable to occupy it immediately, ?

Answer 8

in order to carry out construction/renovation/alteration/redecoration, or to dispose of their existing residence, this ‘period of absence’ is treated as occupation.

Provided it does not exceed 24 months.