CGT—PPR relief for UK residents with overseas dwellings and non-UK residents with UK dwellings
Produced in partnership with Alison Cartin of Taylor Wessing LLP
Last updated on 28/07/2020

The following Private Client practice note produced in partnership with Alison Cartin of Taylor Wessing LLP provides comprehensive and up to date legal information covering:

  • CGT—PPR relief for UK residents with overseas dwellings and non-UK residents with UK dwellings
  • Principal private residence relief: the basics
  • Capital gains tax and non-residents disposing of UK residential property
  • Pre-6 April 2015
  • From 6 April 2015
  • Restriction of PPR relief post-5 April 2015
  • Day count test
  • Interaction of PPR day count test and UK statutory residence test
  • Interaction of permitted absences reliefs and the restriction of PPR relief
  • Election under s 222 TCGA 1992
  • More...

CGT—PPR relief for UK residents with overseas dwellings and non-UK residents with UK dwellings

Principal private residence relief (PPR relief) exempts part or all of the gain realised on the disposal of an individual’s dwelling-house from capital gains tax (CGT) if the dwelling–house has been their only or main residence at some point during their period of ownership.

UK resident taxpayers can claim PPR relief on the disposal of a UK residence or a non-UK residence. Non-UK resident individuals can claim PPR relief on the disposal of a UK dwelling-house.

From 6 April 2015, an individual’s residence will not be eligible for PPR relief for a tax year unless the individual:

  1. was resident in the country in which the dwelling-house is located in that tax year; or

  2. spent at least 90 nights in the dwelling-house (or dwelling-houses in the same country) in the tax year

Principal private residence relief: the basics

Gains realised on the disposal of an individual’s dwelling-house are, generally, exempt from CGT if the dwelling–house has been their only or main residence throughout their period of ownership (section 222 Taxation of Chargeable Gains Act 1992 (TCGA 1992)). Where a dwelling-house has been an individual's only or main residence for only part of their period of ownership only a proportion of the gain will be exempt from CGT.

Married couples/civil partners can only have one main residence between them

Related documents:
Key definition:
Capital gains tax definition
What does Capital gains tax mean?

A tax (also called CGT) on the disposal of an asset where the profit is capital in nature. It applies to individuals, including personal representatives, trustees and individuals carrying on a trade or business in partnership. Companies do not usually pay CGT but pay corporation tax on any chargeable gains.

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