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HMRC internal manual

Capital Gains Manual

From
HM Revenue & Customs
Updated
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Private residence relief: permitted area: location of the permitted area

TCGA92/S222 (4) sets out that where the garden and grounds occupied and enjoyed with a dwelling house are in excess of the permitted area, the part to be determined as the permitted area is the part “most suitable for occupation and enjoyment with the residence.”

If the grounds of a residence are not all of equal value, for example if part of the grounds has development value, it may be just as important to determine the location of the permitted area as it is to determine its size.

Again, this is a matter for the Valuation Office Agency to determine. As well as determining the extent of the permitted area, the District Valuer will also provide you with a plan showing the location of the permitted area. This decision can be appealed by the taxpayer in the same way as the decision on the extent of the permitted area.