Private Residence Relief 2026/27: Who Qualifies and How Much

What are the conditions for full Private Residence Relief?

GOV.UK says you get full relief automatically if all of these apply:¹

Source: GOV.UK, Tax when you sell your home.¹

How is partial relief worked out?

Relief is time-based. You add up the months that qualify (the months you lived there as your main home, the final 9 months and any qualifying absences), divide by the months you owned it, and that fraction of the gain is exempt. GOV.UK's own example: if you owned a home for 20 years and were away for 5 of them in a period that does not qualify, your relief is reduced by 25%.²

If part of the home is let to a tenant or used only for business, relief is also reduced by the proportion of the home involved. For a let part you may get Letting Relief on top, but only if you lived there at the same time as the tenant; it is the lowest of your PRR, £40,000 and the gain on the let part.⁴ The former home guide covers Letting Relief in detail.

Worked example: a home with a spell abroad and a let at the end

Dan bought a flat in October 2011 and sold it in October 2026: 180 months of ownership and a gain of £150,000 after costs. He lived there for 5 years, was posted abroad by his employer for 3 years, came back and lived there for 2 more years, then moved in with his partner and let the whole flat for the last 5 years. He earns £60,000.

The 3 years abroad count because Dan was working outside the UK and lived in the flat before and after.² The last 4 years and 3 months of the let do not: he never moved back, and he lived elsewhere while it was let to a tenant, so Letting Relief does not apply.⁴ He has tax to pay on a UK home, so he must report and pay within 60 days of completion.⁸

Which absences still count as living there?

Some periods away are treated as if you lived there, as long as the home was your only home or your nominated main home, and you lived in it before and afterwards (unless your work prevented you from returning):²

• absences for any reason adding up to 3 years;
• up to 4 years when you had to live away from home in the UK for work;
• any period working outside the UK;
• up to the first 2 years of ownership while the home was being built or renovated, or you could not sell your old home, if you then moved in within 2 years of buying.

The final 9 months always count, even if you had nominated a different home by then.²

What if you have two homes?

In most cases you only get relief on one home for any period.² If you live in two, you can nominate which one is your main home by writing to HMRC; every owner of the property must sign the letter, and you must do it within 2 years every time your combination of homes changes.³ Without a nomination, the question is one of fact: which home is really your main residence.

Married couples and civil partners living together have one main residence between them and can nominate jointly.⁵ A nomination is often used where one home is about to be sold: the short time it is nominated can bring in the final 9 months too. See CGT on a second home for the home that is not covered.

Do the garden and outbuildings qualify?

Garden and grounds of up to half a hectare (5,000 square metres) qualify with the house. Above that you may not get relief on all of it: the permitted area is what is needed for the reasonable enjoyment of the house as a home, taking into account its size and character.⁵

Selling part of the garden: timing matters. HS283 says relief is not due if you sell all or part of your garden after you have sold your home, or if the land had been fenced or divided off from the garden for development at the time you sell it.⁵

Does working from home or a lodger affect it?

Working from a room that is also used for other things, such as a spare bedroom or the kitchen table, does not prevent full relief. A room used exclusively for a trade or business does not qualify, and that share of the gain is taxable.⁵

A lodger who shares your living space with you is not treated as letting part of your home, so it does not reduce your relief.⁴ Letting a self-contained part of the house to a tenant is different: you only get PRR on the proportion you lived in, though Letting Relief can cover the let part if you lived there at the same time.⁴

Can non-residents get Private Residence Relief?

Yes, but with an extra test. If the home is in a country where you are not tax resident, it only qualifies for a tax year if you (or your spouse or civil partner) spend at least 90 days there in that year; a day counts if you are there at midnight.⁶ This mainly affects people who moved abroad and later sold a UK home. See CGT for non-residents selling UK property.

Do you need to tell HMRC about the sale?

Not if the relief covers the whole gain and you made no other gains or claims: you do not need the capital gains pages of your tax return,⁵ and no UK property return is needed when there is no tax to pay.⁸ If part of the gain is taxable, a UK resident must report and pay within 60 days of completion, then include the sale on any Self Assessment return. See how to report CGT on property. Non-residents must report every UK property sale, even with no tax to pay.

Frequently asked questions

This page is general information, not tax advice. Private Residence Relief depends on facts such as where you really lived; take advice if your history is complicated.