Beta This part of GOV.UK is being rebuilt – find out what this means

HMRC internal manual

Capital Gains Manual

From
HM Revenue & Customs
Updated
, see all updates

Private residence relief: final period exemption: disposals by disabled persons etc. from 6 April 2014

TCGA92/S225E

If a dwelling house has been used as its owner’s only or main residence at some time in his or her period of ownership then the final the period of ownership that will always qualify for relief is 36 months provided the conditions of TCGA92/S225E are met.

Relief will be due when at the date of the disposal either of the two following circumstances apply:

Where -

  • the individual is a disabled person or a long-term resident in a care home, and
  • the individual does not have any other relevant right in relation to a private residence. 

Or where -

  • the individual’s spouse or civil partner is a disabled person or a long-term resident in a care home, and
  • neither the individual nor the individual’s spouse or civil partner has any other relevant right in relation to a private residence. 

Additionally where an individual has occupied a property under the terms of a settlement and TCGA92/S222 applies by virtue of TCGA92/S225 (see CG64500+) the position of the individual entitled to occupy the property under the terms of the settlement is considered TCGA92/S225E(7).

The highlighted terms are defined as follows:

An individual has any other relevant right in relation to a private residence at the time of the disposal if at that time:

the individual owns or holds an interest in a dwelling house (or part) other than that in relation to which the gain accrued, or

the trustees of a settlement own or hold an interest in a dwelling-house (or part) other than that in relation to which the gain accrued, and the individual is entitled to occupy that dwelling-house (or part) under the terms of the settlement,

and

section 222 could apply to that interest

Care home means an establishment that provides accommodation together with nursing or personal care;

Disabled person has the meaning given by Schedule 1A to FA 2005, which states:

Disabled person” means—

  1. a person who by reason of mental disorder within the meaning of the Mental Health Act 1983 is incapable of administering his or her property or managing his or her affairs,
  2. a person in receipt of attendance allowance,
  3. a person in receipt of a disability living allowance by virtue of entitlement to the care component at the highest or middle rate,
  4. a person in receipt of personal independence payment by virtue of entitlement to the daily living component,
  5. a person in receipt of an increased disablement pension
  6. a person in receipt of constant attendance allowance, or
  7. a person in receipt of armed forces independence payment.

Where the individual has been resident or could reasonably be expected to be resident in the care home for at least three months they are a long-term resident.