The Commissioners for HM Revenue and Customs v Desmond Higgins

JurisdictionUK Non-devolved
JudgeMrs Justice Rose,Judge Cannan
Neutral Citation[2018] UKUT 0280 (TCC),[2018] UKUT 0280 (TCC)
CourtUpper Tribunal (Tax and Chancery Chamber)
Subject MatterTax,26 September 2018
Date26 September 2018
Published date26 September 2018
[2018] UKUT 0280 (TCC)
Appeal number: UT/2017/0098
CAPITAL GAINS TAX main residence relief sections 222, 223 TCGA 1992
off-plan purchase period of ownership whether determined by reference to date
of completion or date of exchange of contracts section 28 TCGA 1992 appeal
allowed
UPPER TRIBUNAL
TAX AND CHANCERY CHAMBER
THE COMMISSIONERS FOR HER MAJESTY’S
REVENUE AND CUSTOMS
Appellant
- and -
DESMOND HIGGINS
Respondent
TRIBUNAL:
MRS JUSTICE ROSE
JUDGE JONATHAN CANNAN
Sitting in public at The Rolls Building, Fetter Lane, London EC4A 1NL on 18
and 19 June 2018
Mr Christopher Stone of counsel instructed by HM Revenue and Customs
Solicitor’s Office for the Appellant
Mr Michael Thomas of counsel instructed by Fieldfisher LLP for the
Respondent
© CROWN COPYRIGHT 2018
DECISION
1. This is an appeal against a decision of the First-tier Tribunal (Tax Chamber)
(Judge Heather Gething and Mrs Helen Myerscough) [2017] UKFTT 236 (TC)
5
released on 16 March 2017. The FTT allowed an appeal by the Respondent (“Mr
Higgins”) against a closure notice dated 12 May 2016 which assessed Mr Higgins to
capital gains tax of £61,383 for tax year 2011-12. The appeal raises a short point of
construction concerning the availability of relief on disposal of a main residence. In
particular, at issue in this case is the identification of the “period of ownership” for the
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purposes of that relief where a property has been purchased “off plan”.
2. The facts found by the FTT are set out at [3] of its decision and may be
summarised as follows:
(1) In 2004 Mr Higgins wished to purchase an apartment in a development of
the former St Pancras Station Hotel in Central London. He paid a reservation
15
deposit of £5,000 to secure Apartment 4.24 St Pancras Chambers (“the
Apartment”) which was a 2-bedroom apartment to be constructed in a tower.
(2) It seems that there were some issues relating to title to the site that needed
to be resolved. In any event, on 2 October 2006 Mr Higgins, referred to as the
Buyer, entered into a contract with Manhattan Loft St Pancras Apartments Ltd,
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referred to as the Seller (“the Contract”). At that time the development works
had not yet commenced and the Apartment was identified on the plans but did
not then exist.
(3) Clause 6 of the Contract included various terms as to how the Apartment
would be constructed, including terms as to the standard and specification of the
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work. The Seller reserved to itself the right to vary the materials and
workmanship provided such variations would not materially adversely affect the
market value or floor area of the Apartment.
(4) The purchase price was £575,000 made up as follows:
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£575,000
£5,000
£52,500
£57,500
£460,000
(5) We were referred to the Contract and whilst the FTT does not record the
fact, Mr Higgins was to be granted a 125 year lease by the Seller in a form

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