Letting Relief Changes 2019, 2020 & Beyond


Andy Wood

Andy is a practical, creative tax adviser who assists a variety of clients in achieving their personal and commercial objectives in the most tax efficient manner.

Letting Relief Changes – PPR relief – Private Residence Relief Deemed Occupation…


As you may be aware, private residence relief is a highly attractive relief.

For our full guide on PPR relief then please visit here.

PPR relief is potentially available in respect of:

  • Actual occupation; and
  • Periods of ‘deemed occupation’– in other word, although you didn’t live there, the statute allows us to pretend you did.

This latter category is still dependent on the fact that the property was a main residence or was subject to a private residence relief election under TCGA 1992, s222.

The various ‘reliefs’ that provide for deemed occupation can be split in to two categories:

  • All cases – Apply in any case where the property has been a main residence; and
  • Sandwich reliefs – where the property was occupied before andafter the period of absence

One relief which is available in all cases is ‘Letting Relief’

Letting relief changes – current position

This will apply in all cases where the property has at any time been occupied as the main residence and the property has been let (ie it is not a sandwich relief).

However, the amount of relief provide is the lower of:

  • The gain that is attributable to the let period;
  • The total amount of the gain subject to private residence relief; and
  • £40,000.

Letting relief – proposed changes

There is currently a Consultation Document (“ConDoc”) out in respect of mooted changes to Lettings Relief.

The reform will significantly limit the availability of Letting relief and restrict it to those who share the occupation of their home with a tenant. In other words, in circumstances where one has a lodger.

This will apply to disposals that take place on or after 6 April 2020.

Shared occupation is considered to apply where the owner lives with the tenant in the same property and continues to occupy that dwelling as his/her only or main home throughout the let period.

As such, the narrower version of Letting Relief will not be available for any periods where the owner no longer resides in the property with the tenant.

The Letting Relief changes will apply to all disposals made from 6 April 2020. From that date, only those periods where the owner was, or is, in shared occupancy with the tenant will qualify for lettings relief


The Letting relief changes once again announce a further narrowing of the availability of PPR relief.

If you have any queries about Letting Relief changes or about private residence relief at all then please get in touch. You can also read more about property tax below…

Letting Relief changes was last updated on 8 April 2019

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