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TonyTax
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15942
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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I have a house in England with has never been my pincipal residence.

Resolved Question:

I have a house in England with has never been my pincipal residence. It
was left to be by my mum and probate value in November 2009 was £ 390,000.
From mAY 15 2013 until mAY 15 2016 it has been rented out. Before that it
was empty, being repaired. I spent about £20,000 on repairs. On the market it can make an estimated £800,000.
2. I understand that if I were to make this my principal private residence
and I lived in it for a certain length of time the CGT would be less? How
does this work - how long would I need to live in it, and what tax savings
would apply?
I am a UK citizen and resident
Submitted: 1 year ago.
Category: Tax
Expert:  TonyTax replied 1 year ago.
Hi. You should refer to HS283 here for information on the main residence and CGT. If the property has been your main home at some point during your ownership of it, in theory you will qualify for a proportionate reduction in the taxable gain and you will be given the last 18 months of ownership as a tax free period too. You will also qualify for letting relief which is only available when a property has been your main home. Example 9 in HS283 here shows you how to work out the taxable and non-taxable parts of the gain. There is no set time that a property has to be your main home in order to give you access to the reliefs I mentioned above. However, many people move in for six months or so and then claim the reliefs and because it is pretty obvious what they are trying to achieve, HMRC challenge their claim to those reliefs and have been winning cases taken to tax tribunals. A period of residence is more about the quality of that period of residence than the time. Take a look here for information what "quality of occupation" means in this context. I hope this helps but let me know if you have any further questions.
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