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Where Taxpayers and Advisers Meet

Private Residents relief and care homes

neil123
Posts:7
Joined:Thu Jun 30, 2022 12:10 pm
Private Residents relief and care homes

Postby neil123 » Sat Aug 13, 2022 1:30 pm

Hello Forum

My aunt who is 89 years old is a resident in a nursing home since February 2021.
I look after my aunt's affairs as she has lost capacity due to dementia and is unlikely to return to her home unless 24-hour care was provided at her home.
As she needs assistance with Activities of daily living at any time of the day.

My aunt owns the lease on a flat that is only in her name/she was the only resident and the only home she owned lived in for decades.
Does my aunt lose the CGT Private Residents relief as he is now a resident in a care home?
Do I need to make a nomination on her behalf to HMRC etc?

Neil

bd6759
Posts:4256
Joined:Sat Feb 01, 2014 3:26 pm

Re: Private Residents relief and care homes

Postby bd6759 » Sun Aug 14, 2022 9:53 am

Yes, but only for periods after it ceased to be her PPR. The gain is time apportioned.

In addition the final 36 months of ownership are exempt. So there will be full exemption up to February 2024.

Why would you want to keep an empty house? Sell it whilst it is still exempt.

neil123
Posts:7
Joined:Thu Jun 30, 2022 12:10 pm

Re: Private Residents relief and care homes

Postby neil123 » Sun Aug 14, 2022 4:47 pm

Hello
Thank you for the reply,
And confirming there is an additional 36 months after my aunt "no longer resides" at the flat" for her qualifying for PRR

As already stated my aunt moved into the nursing home in February 2021,
it was hoped and said by the GP she might recover from the added confusion caused by delirium and this could take up to a year...

Maybe a complex question
So is the date fixed in stone as February 2021 as when my aunt first moved into the care home or when it was deemed there was no chance of her going home to her flat?

There are a lot of reasons why I say the small flat is not up for sale, I can send a private message as it feels private and off tax topic

bd6759
Posts:4256
Joined:Sat Feb 01, 2014 3:26 pm

Re: Private Residents relief and care homes

Postby bd6759 » Mon Aug 15, 2022 10:46 am

If she moves back in to the property, up to 3 years of the absence will be ignored. If she doesn’t return, the whole absence is a period of non residence.

Selling the property is pretty much on point when it comes to CGT. If the property is not sold, you won’t have to worry about CGT. On her death the property can be passed to a beneficiary at market value and then sold with no CGT.

AGoodman
Posts:1734
Joined:Fri May 16, 2014 3:47 pm

Re: Private Residents relief and care homes

Postby AGoodman » Mon Aug 15, 2022 6:59 pm

For what it is worth, a year or two when PPR does not apply under any of the exceptions is unlikely to lead to a significant, if any, tax bill. Your aunt would also have the £12,500 annual exemption, which applies after PPR relief has been deducted.

(assuming this small flat is not in Chelsea or Kensington)

and, dare i say it, if you/she does not want to sell then there is little that can be done about it so I would not worry unduly.


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