Tuesday, 28 September 2021

Second homers look out

PEOPLE who own more than one home could be affected by Treasury plans to overhaul capital gains tax on the profits from a property sale, it has emerged.

Those who have more than one home can currently choose which one they want to qualify for principal private residence relief (PRR) which exempts them from paying capital gains tax on a main residence when it is sold. However, the Government is worried that non-UK residents can nominate a British property for PRR even if they don’t live there. The changes to how properties can be nominated could affect both UK and non-resident property owners from next April.

The Government is proposing that instead of letting people nominate a property for relief, a decision on which home the relief applies to should be based on where people’s mail is sent and where they are registered on the electoral role. Another option being looked at is to introduce fixed rules to identify which property is someone’s main residence, one of which could be based on where they have spent the most time during the tax year.

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