The taxpayer disposed of his farmhouse, and sought exemption from Capital Gains Tax under sections 101 and 102 of the 1989 Act. The Revenue said it had not been his only or main residence. Contracts had been exchanged for its purchase in 1983, but the transaction was completed only two years later. In the interim he lived elsewhere. Before completion, he advertised the property for sale. He moved in without his family, having separated from his wife. He then completed the purchase of another property which he recorded as his residence. The Revenue denied that his occupation was a residence at the property. He appealed against the upholding of this assertion.
Held: The word ‘residence’ was an ordinary word. There was no ground for distinguishing its use in Capital Gains Tax and Income Tax contexts. There was ample evidence to support the Commissioners conclusion that he was in temporary occupation and not in residence: ‘The taxpayer had just separated from his wife and family. He had nowhere else to live. The Farmhouse had nine bedrooms and was hardly a suitable home for a single man. It had already been placed on the market. The taxpayer’s occupation was manifestly a stop gap measure pending the completion of his purchase of somewhere else to live. As soon as the Farmhouse was sold the taxpayer moved into Ayton. ‘ and
Temporary occupation at an address does not make a man resident there. The question whether the occupation is sufficient to make him resident is one of fact and degree for the Commissioners to decide.
Judges:
Morritt LJ VC, Robert Walker LJ
Citations:
[2001] EWCA Civ 364
Links:
Statutes:
Capital Gains Tax Act 1989 101 102
Jurisdiction:
England and Wales
Citing:
At SCIT – Longson v Baker (Inspector of Taxes) SCIT 8-May-2000
SCIT CAPITAL GAINS TAX – Private residence exemption – Whether gain on sale of house exempt – Extent of ‘the permitted area’ – Section 222 Taxation of Chargeable Gains Act 1992. . .
Appeal from – Longson v Baker (Inspector of Taxes) ChD 5-Dec-2000
The test of whether land attached to a private dwelling in excess of a half hectare, was required for the reasonable enjoyment of the property was an objective one. The individual circumstances and requirements of the taxpayer should not affect the . .
Cited – Levene v Inland Revenue Commissioners HL 1928
Until 1919 Mr. Levene had been both resident and ordinarily resident in the UK. Then, for five years he spent about five months (mainly in the summer) each year, staying in hotels in the UK and receiving medical attention or pursuing religious and . .
Cited – Kirkby v Hughes Chd 22-Feb-1993
Income tax was payable under Schedule D on the sale of a builder’s own house. He was shown to have been, in effect, trading taking into account his past record, and doubts about his intention ever to occupy the house as his residence. Some element . .
Lists of cited by and citing cases may be incomplete.
Capital Gains Tax
Updated: 12 November 2022; Ref: scu.200904