Cgt tax enquiry

[Bill31]

Hi have hmrc investigating my cgt form for a asset i sold. It was my only property I owned.
Theres a error in the calculation of cost which is being sorted.
There also asking details of what property was used for during ownership. First year i owned it i did renovation work and lived there few days a week, keeping a eye on things.
Im starting to realise now after more resesrch on net that maybe i couldnt claim prr relief as i didnt live their full time. Shortly after renovation work i run out of money and decided to let it out and stayed at my mums.
Am i right in beliveing i was correct for claiming prr and letting relief?

[jpkeates]

Where you live is a matter of fact - did you get your post delivered there, were you registered to vote there and so on.
The fundamental issue is could you prove to HMRC it was your primary residence?

[Flashback1966]

When you let it out, did you pay tax on the rent you received?

[Gordon999]

For owning only one property and if the council tax and electricity/gas bills are in your name for the first year , I think you can show the bills to HMRC and claim the property is your "main residence". If you qualify for main residence, then you should be able to claim ppr and letting relief.

If the property was let out after a few months ( less than one year from purchase ) you may not have spent enough time to qualify it was your "main residence".

[Bill31]

Gordon999,

i dont think i have spent enough time to qualify it was my main residence after researching it in more details. i assumed that i could claim it as residence as it was not on rent during that period and i lived in there few days a week. But now i realised PRR means something else.
Will HMRC fine me for getting this wrong. they have pulled this up after i have submitted my tax for last year.

[Gordon999]

If you have been pulled up and you agree it was a mistake, I think you should write a voluntary letter to Tax Office to withdraw the claim for PPR and letting relief and hope there is no penalty..

But you can still claim the £12K capital gains personal allowance.

[jpkeates]

I would notify HMRC via an accountant, personally, but there's no need to (other than stress).

[Bill31]

HMRC are already aware, they are doing a compliance check. thats how i figured out i didnt understood fully what PPR entails. obviously on my return i claimed for this, and now realised i couldnt as it wasnt my main full time residence, despite staying there a couple days a week on and off.

[jpkeates]

Ah, never good if HMRC find something wrong first.

Where you live is a matter of fact, based on the specific circumstances.
If you regarded the property as your home and paid council tax and had the utility bills in your name, HMRC will have to present a good argument to overcome the argument that it was your home.
There's no specific minimum period you have to live somewhere for it to be your home (although it's a factor).
If you planned for it to be your home and changed your mind when the work was complete, that wouldn'tthat you had lived there.