Postby bd6759 » Sat Dec 12, 2020 6:49 pm
You friends have two residences. They have nominated the London residence as their main one. There is no tax to pay on that disposal.
They buy a new property that they intend to be a residence. Once again they have 2 residences. This time they nominate Norfolk as the main one.
When they sell Norfolk they will be entitled to residence relief - but only for the short period that it was nominated to be their main residence. The relief is time apportioned. During this period, their new London house will not be covered by residence relief.
It’s also worth stating that if the Norfolk house is repaired and enhanced solely to realise a bigger gain on its sale, that increase in value will not be covered by relief.