CG64206 - Private residence relief: tax returns

For disposals before 10 December 2003

• the notes to the Tax Return form for individuals and trustees make it clear that no return is required of the disposal of a person’s home if that disposal is fully relieved from Capital Gains Tax as a result of private residence relief. If partial relief is available the taxpayer should provide the address of the property sold with a computation of the gain or loss

For disposals on or after 10 December 2003 there is a difference for disposals by individuals and by trustees or personal representatives.

Individuals

• no return is required if the disposal is fully relieved from Capital Gains Tax and the acquisition cost of the home is unaffected by gift hold-over relief under the provisions of TCGA92/S260 (see CG67030+).
• if partial relief is available, the taxpayer should provide the address of the property sold with a computation of the gain or loss
• relief may not be due if gift hold-over relief has been claimed on a disposal made on or after 10 December 2003 (see CG65405). Relief may be restricted if gift hold- over relief has been claimed on a disposal made before 10 December 2003 (see CG64933).

Trustees or personal representatives

• where the disposal is by trustees or personal representatives, a return is required because private residence relief, whether under the provisions of TCGA92/S225 or TCGA92/S225A, must be claimed (see CG65405 (trustees) and CG65470 (personal representatives).

In most cases an assertion that any gain is wholly relieved need not be challenged and a computation of the gain will not be needed. You should look out for disposals which may not be wholly relieved but should consider whether enquiries are worthwhile in trivial cases.