CGT—PPR relief for trusts and estates
CGT—PPR relief for trusts and estates

The following Private Client guidance note provides comprehensive and up to date legal information covering:

  • CGT—PPR relief for trusts and estates
  • Private residence occupied under the terms of a settlement
  • Interaction of PPR relief and s 260 hold-over relief
  • Private residence held by PRs
  • Disposals by non-resident trustees

FORTHCOMING CHANGE: As originally announced at Budget 2018, the government ran a consultation between 1 April and 1 June 2019 on proposals to curtail capital gains tax (CGT) principal private residence (PPR) lettings relief in order to better target the relief at owner occupiers and to reduce the automatic final period exemption for PPR relief from 18 months to nine months except in specified circumstances, as well as some technical aspects of the operation of the relief. On 11 July 2019, the government published a policy paper, draft legislation and an explanatory note. These changes, if enacted as part of Finance Bill 2019–20, will take effect from 6 April 2020. For more information, see News analysis: Draft Finance Bill 2019–20—Private Client analysis.

This Practice Note outlines the circumstances in which trustees of a settlement or the personal representatives (PRs) of a deceased person may claim principal private residence (PPR) relief from capital gains tax (CGT) in respect of property held in a settlement or in an estate. For details of PPR relief generally and how it applies to individuals, see Practice Note: CGT—PPR relief.

Private residence occupied under the terms of a settlement

Section 225 of the Taxation of Chargeable Gains Act 1992 (TCGA 1992) extends the PPR exemption in TCGA 1992, s 222 to disposals of settled property where,