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HMRC internal manual

Capital Gains Manual

Private residence relief: the entity of the dwelling house: boats

The analysis which applies to caravans equally applies to houseboats. Houseboats will generally be tangible moveable wasting assets and so exempt from Capital Gains Tax under TCGA92/S45 (1).

A houseboat which is permanently located on a site and connected to all mains services may be regarded as a dwelling house. If the houseboat has been used as an immobile residence for a period of 6 months or more and has had all of its engines removed it should be regarded as a dwelling house. Other cases should be considered on their specific facts.

Occasionally yachts, barges or other boats are used as the residence of their owner. In some cases the useful life of the boat is such that it cannot be regarded as a wasting asset and so a chargeable gain may arise on its disposal. Where this is the case the boat should not be regarded as a dwelling house except in the circumstances explained above which apply to houseboats.