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Mr Lynes sold his home but kept part of the garden and applied for planning permission to develop it.

Four years later, he sold the garden and claimed main residence relief on the sale. The legislation granting main residence relief is written solely in the present tense, and it was concluded that the test of whether the garden was part of Mr Lynes’s main residence had therefore to be met at the time of sale for the relief to be due. As Mr Lynes had already sold his residence, the garden could no longer be used ‘for his own occupation and enjoyment with that residence as its garden or grounds’, and therefore did not qualify for relief.

So land sold separately to the home may qualify for main residence relief if it is sold before the house, but gains on land sold separately after the house will be taxable.

HMRC’s guidance is that if land is sold before the date of conveyancing it can qualify for main residence relief, even if the sale is after the date of the sale contract. If the land is sold after the conveyancing date, it won’t qualify for relief.