HMRC internal manual

Capital Allowances Manual

CA11520 - General: Definitions: Dwelling-house

Dwelling-Houses

There are several references to dwelling-house in CAA01. The term appears in Part 2 (plant and machinery allowances – see CA23060), Part 2A (structures and buildings allowances – see CA92600), Part 3A (business premises renovation allowances – see CA45000) and Part 6 (research and development allowances – see CA60000).

There is no definition of “dwelling-house” in these Parts of CAA01 and so the term takes its ordinary meaning. A dwelling-house is a building, or a part of a building; its distinctive characteristic is its ability to afford to those who use it the facilities required for day-to-day private domestic existence. In most cases there should be little difficulty in deciding whether or not particular premises comprise a dwelling-house, but difficult cases may need to be decided on their particular facts. In such cases the question is essentially one of fact.

A person’s second or holiday home or accommodation used for holiday letting is a dwelling-house. A block of flats is not a dwelling-house although the individual flats within the block may be. A hospital, a prison, a nursing home or hotel (run as a trade and offering services, whether by an owner-occupier or by a tenant) are not dwelling houses.

A University hall of residence may be one of the most difficult types of premises to decide because there are so many variations in student accommodation. On the one hand, an educational establishment that provides on-site accommodation purely for its own students, where, for example, the kitchen and dining facilities are physically separate from the study-bedrooms and may not always be accessible to the students, is probably an institution, rather than a dwelling-house. But on the other hand, cluster flats or houses in multiple occupation, that provide the facilities necessary for day-to-day private domestic existence (such as bedrooms with en-suite facilities and a shared or communal kitchen/diner and sitting room) are dwelling-houses. Such a flat or house would be a dwelling-house if occupied by a family, a group of friends or key workers, so the fact that it may be occupied by students is, in a sense, immaterial.

The common parts of a building which contains two or more dwelling-houses, for example the stairs and lifts, will not comprise a dwelling-house.

Claims relating to Houses in Multiple Occupancy:

We are aware that some taxpayers have submitted claims for plant and machinery allowances in respect of shared parts of houses in multiple occupation (such as hallways, stairs, landings, attics and basements within the houses). They contend that these shared areas are not part of the dwelling-house and that allowances are therefore available. We disagree with this position. If you come across such a claim, please notify the Capital Allowances single point of contact for your area.

Meaning of ‘dwelling-house’ for assured tenancy allowances

The term dwelling-house also appears in Part 10 CAA01 (assured tenancy allowances). For the purposes of Part 10 only, the term dwelling-house has the same meaning as in the Rent Act 1977 – section 531(1) CAA01. Note that allowances under Part 10 CAA01 are not available for expenditure incurred on or after 01 April 1992.