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Discovery Assessment Requirements Were Not Satisfied

By Mark McLaughlin, April 2017
HM Revenue and Customs did not discharge its burden of proving a loss of capital gains tax for the purposes of making a discovery assessment in respect of the disposal of a property on which the appellant had claimed private residence relief. 

In June 2004, the appellant and his wife purchased a property (IA) for £4 million. On the same day, the appellant purchased a property (HS) in his sole name for £1,050,000. 

On 21 February 2006, the appellant contracted to sell HS. The sale was completed on 21 March 2006, for £2,550,000. On 3 March 2006, the appellant and his wife made an election for capital gains tax (CGT) purposes that IA should be treated as their principal private residence (PPR) from 24 June 2004. On 10 March 2006, the couple made an election that HS should be treated as their PPR from 19 December 2005. On 17 March 2006, the couple made an election that IA should be treated as their PPR
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