Capital Gains Tax: Private Residence Relief (PRR) - another quality of occupation case.

If you are living in a property, doing it up to let it out or sell it on, and wish to claim PRR then you must be able to prove evidence of a sufficient quality of occupation to establish that the property was actually your home and not just an investment asset.

In Malcolme Springthorpe [2010] TC 832 a taxpayer claimed that he lived in his property as his main residence whilst renovating it, Unfortunately, he has also claimed exemption from council tax for that period and whilst was connected to electricity and water, was not also connected to the gas. Lack of gas meant lack of hot water or cooking facilities. He also used another address for correspondence during the period.

All in all the Tribunal conclued that his occupation of the property was for the purposes of repairing it and not of making it his home. His PRR claim failed.

In Anthony Metcalfe v RCC (2010) TC 753 the taxpayer owned several properties and claimed that one had been main residence. Lack of both oral and other evidence, including lack of consumption of electricity helped the Tribunal find in favour of HMRC.

These cases follow the similar findings in Jason Moore v HMRC [2010] TC 710, as discussed in our guide to Private Residence Relief which also contains a quality of occupation checklist.