PPR relief has been a tax relief against the gains arising on\nthe sale of a property that is or has been an individual\u2019s only or main\nresidence.\n\n\n\nNew rules came into effect in April 2020, introducing the\ntightening of two common extensions to the relief which is likely to increase\nthe number of sales of homes liable to capital gains tax, or where more tax\nwill be due. \n\n\n\nFinal period of ownership\n\n\n\nFrom April 2020 there have been further changes to the final period of \u201cdeemed occupation\u201d. This has been reduced down form the final 18-months (previously 36-months) to only the final 9-months of ownership. \n\n\n\nHowever, the final 36 months will continue to qualify for the\ndisabled and those in a care home.\n\n\n\nLettings relief\n\n\n\nThis relief can cover gains of up to \u00a340,000 per owner, but it\nis only available if the property has been the owner\u2019s main home for a period. \n\n\n\nThe relief is also capped at the amount of PPR relief due for\nthe period of actual occupation by the owner. \n\n\n\nFrom April 2020 lettings relief can only be claimed if the owner\nof the property is in residency whilst rooms are occupied within the house and\nlet to unconnected persons (the occupier effectively has a lodger in their main\nresidency qualifying for PPR). \n\n\n\nThe ability to claim lettings relief where the whole property\nhas been let out is totally abolished and these periods will be fully\nchargeable to CGT even where the property was let prior to 6 April 2020 \n\n\n\nPeriod of Absence\n\n\n\nIn addition to the above to the above, there is also a further\nrelief for individuals who have a period of absence from their PPR.\n\n\n\nQualifying periods of absences can be claimed on your PPR if\nHMRC conditions are met under s223(3) TCGA92. \n\n\n\n\nIn most cases, these additional periods can only be claimed when\nboth before and after the period of absence there is a time where the house was\nthe owner\u2019s main residence (unless they were prevented from living there as a\nconsequence of their own or legal partners employment making them live\nelsewhere \u2013 see below). \n\n\n\nThe periods of residence do not have to be immediately before\nand after the period of absence.\n\n\n\nThe legislation does not specify how long the period of\nresidence must be. HMRC guidance explains it as quality of occupation rather\nthan length of occupation. You cannot set a minimum period of occupation which\nwill be enough to allow relief for a period of absence. \n\n\n\nHMRC explains that if a house has been used as its owner\u2019s main\nresidence, the final period of ownership will always qualify for relief. That\ndoes not mean that the final period of ownership will qualify as a period of\nmain residence after a period of absence and therefore allow relief for that\nperiod of absence, instead it is classed a period of deemed occupation. The period of absence must be followed by an\nactual period of use of the dwelling-house as its owner\u2019s only or main\nresidence.\n\n\n\nThere\nare two circumstances summarised below where reoccupancy cannot be undertaken\nand a period of absence will still qualify:\n\n\n\nWhere\nthe individual is prevented from resuming residence as a consequence of the\nsituation of their place of work or due to a condition imposed on them by the\nterms of their employment requiring them to reside elsewhere to secure the\neffective performance of their duties, or\n\n\n\nWhere\nthe individual lived with a spouse or civil partner who was prevented from\nresuming residence as a consequence of the situation of their place of work or\ndue to a condition imposed on them by the terms of their employment requiring\nthem to reside elsewhere to secure the effective performance of their duties.\n\n\n\n Use\nof residence during period of absence\n\n\n\nIt does not matter how the residence is used during a qualifying\nperiod of absence. For example, it may be let out at a full market rent without\nany loss of relief under this section.