The following Personal Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:
Anti-avoidance provisions exist to prevent taxpayers from abusing the generous principal private residence (PPR) relief provisions to avoid paying capital gains tax on their houses.
The anti-avoidance provisions apply where:
the tax year is non-qualifying for the taxpayer
there is exclusive business use of part of the residence
the residence was acquired with the intention of making a profit
Also considered in this note is the application of pre-owned asset tax where the family home is gifted in a scheme designed to avoid inheritance tax.
The concept of a ‘non-qualifying tax year’ was introduced from 6 April 2015.
This was part of the consequential amendments necessary to charge UK CGT on disposals of UK residential property. The Government decided that, without this change, non-resident individuals could have taken advantage of the generous PPR rules to exempt a gain on UK residential property from UK CGT.
This affects UK residents with overseas homes as well as non-residents with UK homes, although as the new rules only apply from April 2015, previous PPR elections made by UK residents have been ‘banked’, meaning that if an overseas holiday home has ever been the subject of a PPR election, it should qualify for relief for the last nine months of ownership (the last 18 months of ownership for disposals between 6 April 2014 and 5 April 2020).
A dwelling cannot be treated as a ‘residence’ for the purposes of the PPR rules in any tax year (or part of a tax year if the dwelling was not owned for the entire year) in which:
neither the taxpayer nor the taxpayer’s spouse or civil partner is tax resident in the country in which the dwelling is situated, and
the taxpayer and / or the taxpayer’s spouse or civil partner is physically present in that dwelling (or any other dwelling in that country) for less than 90 ‘days’ in the tax year (with the 90-day threshold pro-rated if
**Free trials are only available to individuals based in the UK. We may terminate this trial at any time or decide not to give a trial, for any reason.
Access this article and thousands of others like it free for 7 days with a trial of TolleyGuidance.
Read full article
Already a subscriber? Login
Capital vs revenue expenditureExpenditure of a capital nature is not allowed as a deduction when calculating trading profits. Expenditure of a revenue nature is allowable, provided there is no specific statutory rule prohibiting a deduction and the expenditure also satisfies the wholly and
This guidance note explains the main scenarios where UK companies (other than financial institutions, etc) must withhold tax at source on payments of interest and how this is dealt with in practice.Obligation to withhold income tax from certain paymentsWhen UK companies, or partnerships of which a
Following Spring Budget 2020, statutory sick pay (SSP) rules were changed temporarily to help workers affected by the coronavirus (COVID-19) outbreak. The Chancellor confirmed the Prime Minister’s previous announcement that SSP will be paid from day 1 rather than day 4. Updated guidance on the
This note applies to transactions whilst the Great Britain was a member of the EU and during the transition period that ended on 31 December 2020. For information on Northern Ireland see the Northern Ireland topic. Triangulation is an EU simplification measure that was introduced in order to reduce