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HMRC internal manual

Capital Gains Manual

Private residence relief: only or main residence: two or more residences: treatment of notice

If a notice or a variation of a notice is received, it should be acknowledged without any comment on its validity, and filed. On acknowledging the notice great care should be taken to avoid giving the impression that the notice is valid where the full facts are not available.

In certain circumstances it may be appropriate to ask the taxpayer or their agent for further information with regard to a notice. For example,

  • It may be apparent that the notice has been given more than two years after the acquisition of a further dwelling house. This doesn’t necessarily mean that the notice is late; the house may not have been occupied as a residence immediately on acquisition. So you should consider asking for more information to establish if the notice has been made after the expiry of the time limit.
  • It may be apparent that the nominated dwelling house has not been a residence of the person giving the notice.
  • If it appears that the nominated dwelling house is occupied under licence, see CG64536, or that the notice takes account of such a residence, you should consider asking the taxpayer or their agent for further information in order to confirm its validity.

Any enquiries that you do make should be to the extent of satisfying yourself, on the facts available, that the notice is valid or invalid. And, where it is invalid, explaining why to the person who has given the notice, or to their agent.

However until a dwelling house is sold any dispute over the validity of a notice will have no tax consequences. Therefore you should not take your enquiries beyond the stage at which, on the facts made available, you believe the notice to be invalid.