rent-a-room and main residence with two properties

[smartsarath2003]

Hi All,
I am brought my first home few years ago which was my only and main residence. Very recently, I did purchased a new home jointly with my wife. My wife and child moved to new property permanently.
I am still at the old property as my main residence and spending most of the time there renovating it. Effectively new home is my 2nd home and is only 2 miles away from the the old one.
I am exploring rent-a-room to rent one bedroom at old property, while I am doing the renovations there.

• Can I continue there as my main residence and use rent a room scheme and get tax free earnings of up to £7500?

• I understand that I can elect main home with in 2 years of new purchase. If I do elect old property as my main home, I believe I get exemption from Capital Gains...if/when I decided to after 3 years? Is this correct?

• Does the electing of main home makes any difference to rent a room?

• I also want to move my correspondence address for banks/other sensitive stuff to new home, as I feel my private data may not be very safe in rent-a-room type shared accommodation. Can I still use rent-a-room and claim old house as main residence even with bank address transferred?

Please throw any light that can help making my situation clear...

thanks in advance

[pawncob]

1. No/Maybe. You can only have one PPR at a time. If it remains as your PPR then you can claim RAR.
2. Old home remains as your PPR and you get PPRR for whole period of occupation.
3. Yes. Only available for PPR.
4. PPR is a matter of fact. having it as your mail address adds weight to the argument, but not essential.

[smartsarath2003]

Thanks pawncob,

So because the old house is my present PPR, I don't need to change the PPR election.

I have read some articles that when people had 2 homes, they then can choose the home that has most gain as PPR, when it comes to selling...may be to avoid paying bigger CGT! Is this correct & leagal?

I also read some that married people can't show two different residencies as PPR with my wife at new home (jointly owned) and I am here at my first home (myself the only owner)

So is there any way round that I can live at old house at least for the period I do the work and use rent-a-room and be exempt for the CGT for that extra period?

[pawncob]

Yes, if it's your PPR. But PPR can only be claimed on one residence at a time.

[AdamS93]

The renovations are irrelevant.

It is where you reside as your main residence, where you sleep, eat, spend time with your family.

You and your wife and only have one main residence between you. The fact your wife and children will be at the new property will strongly indicate that this has become your main residence.