Andrew Nunn v The Commissioners for HMRC
| Judge | JANE SHILLAKER |
| Judgment Date | 27 March 2024 |
| Neutral Citation | [2024] UKFTT 298 (TC) |
| Counsel | For |
| Date | 27 March 2024 |
| Year | 2024 |
| Court | First-tier Tribunal (Tax Chamber) |
Neutral Citation: [2024] UKFTT 00298 (TC)
Case Number: TC09127
FIRST-TIER TRIBUNAL
TAX CHAMBER
Appeal reference: TC/2022/02357
CAPITAL GAINS TAX – Private Residence Relief under s 222 Taxation of Chargeable Gains
Act 1992 - Appropriation to trading stock by householder before disposal to developer
Heard on: 23 November 2023
Judgment date: 27 March 2024
Before
TRIBUNAL JUDGE MALCOLM FROST
JANE SHILLAKER
Between
ANDREW NUNN
Appellant
and
THE COMMISSIONERS FOR HIS MAJESTY’S REVENUE AND CUSTOMS
Respondents
Representation:
For the Appellant:Alan Arenstein of WLH Taxation Ltd
For the Respondents: Kieran Gargan, litigator ofHM Revenue and Customs’ Solicitor’s
Office
DECISION
INTRODUCTION
1.This is an appeal against a closure notice(and related penalty assessment) in which
HMRC disallowed the Appellant’s claim to Principal Private Residence relief (“PPR relief”
or “PPR”) in respect of a sale of land. The land had at one stage been part of Mr Nunn’s
garden, although there is some dispute as to whether it retained that character at the time of
disposal.
EVIDENCEANDFACTUALFINDINGS
2.The documents to which we were referred were:
(1)A hearing bundle of 260 pages (including witness statements from Mr Nunn and
Mr Daly),
(2) An authorities bundle of 343 pages
(3)A skeleton argument for Mr Nunn of 4 pages; and
(4)A skeleton argument for HMRC of 13 pages
3.At the invitation of the Tribunal, the parties made further written submissions following
the hearing.
BACKGROUND FACTS
4.On 17 November 1995, Mr Nunn purchased a property in Oxfordshire for £120,000.
5.In 2015, Mr Nunn reached an agreement with a property developer, Michael Daly
(acting on behalf of his company, M.A. Daly Building Contractors Ltd) (“Daly’s”), for the
sale of a part of the land at the rear of the property. The agreed price was £295,000. The land
in question was at that stage part of the garden of the property.
6.The area of the residence and land in question amounts to less than 0.5 of a hectare.
This is within the ‘permitted area’ (as defined in the legislation set out below).
7.Mr Daly intended to build two houses on the land. Daly’s obtained planning permission
for such development on 23 April 2015.
8.Heads of terms for the sale were agreed in late 2015 or early 2016. Mr Nunn and Daly’s
then instructed their respective solicitors to prepare the formal sale contracts.
9.Mr Nunn’s solicitors provided a draft sale contract to Daly’s solicitors on 7 January
2016. The sale did not progress at that time, in part because Daly’s intended to complete a
transaction relating to the adjoining property first.
10.By 2 June 2016 formal contracts had still not been agreed. Daly’s were keen to begin
work on the development, in order to make progress during good weather.
11.In order to provide some comfort to Mr Daly, Mr Nunn signed a letter from Mr Daly
dated 2 June 2016 (the “2 June Letter”) which stated:
“As discussed we have now discharged all conditions relating to the
planning consent on your property. We really would like to commence work
ahead of contracts being signed as I think this will still take 2-3 months and
we are ready to start now.
We have agreed heads of terms which are currently being converted into the
contract and the gross purchase price is fixed at £295,000 as planning
consent has been granted.
1
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