CGT - to convert or not to convert

[John b200]

Hi,
I have gained planning permission for residential conversion on a barn at my small holding and I am unsure of my capital gains situation if I sell it undeveloped or alternatively convert it and live in the conversion.

Question 1. Entrepreneurs Allowance
I bought the farmhouse and land in 2003 and built the barn in 2012, planning was gained in 2015. Im retired with a company pension and have run the smallholding as a partnership with my wife since 2003, we have accounts, tax returns and are VAT registered. We have made a few hundred pounds profit or loss every year from farm subsidies, buying and selling and breeding a few sheep. The barn structure was bought through the business but the land it stands on and the farmhouse were bought personally as our house. Would entrepreneurs allowance apply if I close the business before selling the barn (value now £200k, capital gain about £175k) ? Or will the inland revenue say the business is too small scale for this ?

Question 2. What CGT if I convert and live in the barn.
If I convert the barn then live in it, I have been told that I will have to pay CGT when I eventually sell, proportioned between the time I owned it as a barn and the time it was my PPR. I'm not sure if this is correct and how it would work and at what stage the property value would be taken into account.

I'd appreciate any help, as I need to decide soon whether the sell or do the conversion.

Thank you in advance,

John