Hello and welcome to the site. Thank you for your question.Provided you can demonstrate there was no intention to profit from the property when you bought it and that you had every good intention to move into the property supported by actions taken by you, e.g. making the property address your main residential address and registering with local council, you may have a good case to agrue it was your only property and claim private residence relief on the gain.Please read the notes under Period of absence on Page 4 of HMRC helpsheet HS283 covering private residence relief. More information here
You could agrue change of circumstances were the cause for not moving into the property.As a general rule, if you buy a property and renovate it to sell without either moving into it or letting it albeit for a short period HMRC would view the transaction as a trade.. you are deemed to be property developer and not property investor and the gain is treated as profit from trade and subject to income tax and NI.
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Thank you. The period of absence information is particularly helpful.
Would you advise therefore that no initial return is made to HMRC regarding this sale (as I feel we have a good case to argue), and that we should only prepare a 'defence' if HMRC were to investigate down the line?