Q&A: For tax purposes, how long must you live in a property before it becomes your main residence?

Q. My wife and I have had a rental property for some years and now that we are retired, we want to live there and rent out our (original) main residence. How long must we live in a property before it becomes our main residence?

A: There isn’t a defined number of months or years before principal private residence can be assured to apply. What needs to be shown is that you are moving to the property with the intention of staying there for the long term. Possibly six months to a year would be a reasonable time. You should also register on the electoral role for the area of the country where you intend to reside and ensure that HMRC is aware of your change of address. Once the property is established as your main residence should you ever wish to sell it you will be able to benefit from the final nine months exemption under principal private residence relief.

Further information about principal private residence relief can be found on the gov.uk website here.

About the Author

Martin Johnson

Partner

With expertise in advising family-owned companies on a range of tax, accountancy and business issues, Martin also has an in-depth knowledge of the automotive and property sectors. In addition, he provides advice on inheritance tax planning and financial management to owner-managed businesses.  Martin leads the firm in developing its expertise in the buy-to-let sector, advising both residential and commercial property owners on relevant tax and legislation issues. A further element to Martin’s role is to build Torgersens’ relationships with banks, financial advisors and specialists in commercial and employment law to ensure that the firm’s clients have access to market-leading guidance.  

To get in touch please e-mail martin.johnson@torgersens.com.