Main Residence for Tax Purposes?

[ByeByeMissAmericanPie]

I’ve been trying to work out just how long you need to be resident in a property to call it your main home?
There seems to be a multitude of answers to this on Google. I know HMRC take a dim view if they think you’re moving in, doing up, and moving on…

I’ve got a B2L, can’t sell it despite reduced price. Divorce underway. Family home has just sold. I could fill it with tenants tomorrow, but wondered if I moved in… just how long I’d have to live there before I could legally call it home.

Any advice welcome. My accountant is umming and ahhhing about it and seems unable to answer this!

They can't give you a straight answer because there isn't one.

It's not about length of residence but about quality of residence. Have you moved in simply to get the property to qualify for ppr etc. have you changed address Everywhere, changed doctors (if further away from where you stay now) etc

There's no set time period, but you need to make it your main base for family, switch all correspondence there (banks, drs etc), basically make sure you act like it's your main home basically! I'd say at least a year but ideally longer. Where would you live otherwise?

Bear in mind tho that just because it becomes your PPR, it doesn't wipe out the BTL history. So you get pro rating, e.g. if you've owned it for 5 yrs then establish PPR for say 2 yrs, then you get PPR relief on 2/7 of the gain.

Sorry, too many basicallys!

Yes you get a proportional rating depending upon the length of time you live there. As stated above you don’t wipe it all off as it’s been lodged at land registry as second home.

The law changed on this a while ago.
There are some decent websites that explain the formula on it.

Many Thanks to you all for this - makes sense on a pro rata basis…

For what context? Capital gains tax?

As said by others, courts have decided it's "quality" rather than "quantity" that matters. So there is no set time. There was a court case where a house was lived in for a very short time which counted as main residence because there was intention it was for the long term but become short term due to unforeseen (genuine) circumstances.

If HMRC (and ultimately the tax tribunal/court) believe you have no intention of it being a long term main residence then they are likely to refuse your claim.

As a rule of thumb a married couple can only have one “nominated” home at a time. It’s pro-rated but it’s expected to be measured in years not weeks or months. There used to be a rule that if you had lived in it at all you got the first and last year counted as residential regardless of whether that was accurate but I don’t know if that’s still true.