Our property was rented out, but now we wish to retire into it. For how long must we live in it before it becomes our sole residence? I believe there is a period of time when you would still have to pay some tax owed; does this evaporate after a period of time? Or is it always there? We have always paid tax on the rental.
Arthur Weller replies:
There is no fixed answer to this most frequently asked question. You need to be able to show that you are moving in to the property 'lock, stock and barrel', with the intention to stay long term. Having said that, maybe six months to a year would be a reasonable amount. But even if you do now establish this property as your main residence, the tax on the years owned until today will still apply, with the exception of the letting exemption for private residence relief purposes (and possibly the final period (18 months) exemption - depending on how long you now live in the property).
This question was first printed in Property Tax Insider in November 2018.