Many homeowners pay Capital Gains Tax on the sale of their property, but if it has been your main or only residence at some point, you can claim Private Residence Relief ...
However, Private Residence Relief (PRR) can only be claimed on the actual time you were living in residence (in addition to the last 9 months) as this is called deemed occupation though other periods of absence can be claimed for.
These instances include:
- If you're abroad for employment (for an unlimited period)
- You are working elsewhere in the UK (up to four years)
- Or you are absent for any reason (for a maximum of three years)
Deemed occupation also includes your spouse for the first two reasons and multiple periods of occupancy can be linked together. However, do remember that you must live in the property full-time and as your main residence for it to be deemed occupation. If not, then only points one and two above can apply.
This is useful to bear in mind when you need to do renovations or decoration before you can occupy it. This can be included under the Extra Statutory Concession D49 as long as this absence is less than 12 months. This can be extended up to two years with the blessing of HMRC as long as there is a good reason outside of your control.
If you'd like to find out more about anything I've written here, do call me on 01908 774323 or leave a comment below and let's see how I can help you.