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How does the two-year time limit for main residence elections actually apply? KEITH GORDON explains that taxpayers may have a surprise card to play
KEY POINTS
- The number of taxpayers affected by the two residences rule may be wider than anticipated
- The circumstances where an election may be required
- Was the two-year rule misinterpreted?
- Problems with the decision in Craig-Harvey
- An alternative view of TCGA 1992 s 222(5)
One situation that crops up fairly frequently is the taxpayer with two residences one of which is to be sold and the other to be retained. ]
As many readers will be aware the capital gains tax exemption for residences applies only to a taxpayer's 'only or main residence' (TCGA 1992 s 222(1)).
So if a taxpayer has two residences at any time then in general one will attract relief in respect of that time whereas the other will not.
At this point ...
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