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HMRC internal manual

Capital Gains Manual

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HM Revenue & Customs
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Private residence relief: permitted area: larger area of garden and grounds

TCGA92/S222 (3) sets out that a larger area of garden and grounds than the 0.5 hectares permitted by section 222(2) may be allowed if the statutory test is satisfied. The provision reads,

222(3) Where the area required for the reasonable enjoyment of the dwelling house (or of the part in question) as a residence, having regard to the size and character of the dwelling house, is larger than 0.5 hectares, that larger area shall be the permitted area.

It is the responsibility of the Valuation Office Agency to determine the extent of the permitted area. Therefore where you encounter the argument that an area of greater than 0.5 hectares should be permitted you should refer the matter to the Valuation Office Agency following the guidance at CG64860+.

When making their determination, in line with the statutory test set out in section 222(3), the District Valuer will consider the following factors,

  • The size and character of the dwelling house
  • What part of the dwelling house has been used as its owner’s residence
  • What land is required for the reasonable enjoyment of that residence