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Were the “flippers” just following the Telegraph’s advice?

May 31st, 2010

Remember their 10-point guide to CGT avoidance?

Three days before Gordon Brown became Prime Minister the Telegraph published this guide to property owners wanting to avoid capital gains tax. One choice bit was:

“Become a butterfly and flit between homes
Or in the jargon, switch “principal private residence” exemptions between properties. All gains on property are taxable with the exception of the home you live in which the taxman calls your principal private residence. However, if you own more than one home you can elect which you wish classed as your primary residence, provided there is some evidence that you have actually resided there, albeit shortly. If you live for even a matter of weeks at any stage in your “second” home, this enables you to write off the last three years of capital gains when you come to sell…”

Hat-tip to Scott P on the previous thread.

Mike Smithson