Facts
- Mr. Moore claimed principal residence relief (PRR) on gains from the sale of a property.
- HMRC rejected the claim, asserting that the property was not his main home.
- Mr. Moore owned multiple properties and spent varying amounts of time at each.
- The disputed property was a flat located above his business premises.
- Mr. Moore’s stays at the flat were infrequent and for short periods, yet he claimed it was his main residence.
- The tribunal was required to determine whether these stays met the requirements for PRR.
Issues
- Whether the property in question qualified as Mr. Moore’s main residence under section 222 of the Taxation of Chargeable Gains Act 1992.
- Whether irregular and limited occupation of a property suffices for PRR.
- To what extent a taxpayer’s intention or period of ownership impacts eligibility for PRR.
Decision
- The tribunal found that continuous or exclusive occupation of the property was not required for PRR.
- However, the property must function as a genuine home; actual usage is critical, not just plans or brief occupation.
- Frequency, length, and the manner of use were assessed; Mr. Moore’s stays were too infrequent and minimal to qualify the property as his principal residence.
- The tribunal held that ownership duration and intention alone do not establish residence; actual occupation is determinative.
- Mr. Moore’s claim for PRR was refused.
Legal Principles
- The definition of “residence” under section 222 TCGA 1992 depends on factual use rather than intentions or the duration of ownership.
- Establishing a property as a main residence for PRR requires evidence of consistent and substantial use as a home.
- The approach aligns with previous authority, such as Goodwin v Curtis [1998] STC 475, confirming actual occupation must be proven.
- Record-keeping of dates, durations, and nature of stays may support PRR claims.
Conclusion
The First-tier Tribunal confirmed that principal residence relief is determined by the actual use of the property as a main home; intention and duration of ownership are insufficient, with factual evidence of occupation being essential for PRR eligibility.