CGT private residence exemption

The exemption from CGT, for the taxpayer’s only or “main residence” is probably the most important tax relief there is for the majority of individual taxpayers. This exemption is available to trustees, in respect of a dwelling house which is held in trust, and occupied by a beneficiary “entitled to occupy it under the terms of the settlement” (see s225 TCGA 1992). Trustees may be interested in a decision which, very harshly, denied the relief to a taxpayer who had acquired a house and lived in it, and then demolished the original house and built a new one before selling the property.