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HMRC internal manual

Capital Gains Manual

From
HM Revenue & Customs
Updated
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Private residence relief: permitted area: introduction

The area of garden and grounds of a person’s residence that qualifies for relief is referred to in the legislation as the permitted area. The permitted area includes the site of the dwelling house. TCGA92/S222 (2) defines the permitted area as 0.5 hectares.

If the garden and grounds of the residence, including the site of the dwelling house, do not exceed the permitted area then relief is automatically due for that whole area.

If the garden and grounds, including the site of the dwelling house, exceed the permitted area then relief may be available for a larger area if that larger area can fulfil a stringent statutory test which is explained at CG64818.

The legislation provides tests to determine,

  • The extent of the permitted area at TCGA92/S222 (3), and
  • The location of the permitted area at TCGA92/S222 (4)