Selling part of your garden

Potentially a tax-free way to make the most out of your unused land

For those of you with a sizable garden, you may have thought at some point that you may not be using this space to its full potential. Maybe you were planning to grow some vegetables and then realised, you don’t have the green thumb you once thought you did. Maybe someone else could use that space better.

If so, you might have wondered whether you would be better off selling this land to make some money. Space is at a premium these days so if you have a wasted plot in an urban area this could be worth a small fortune.

So if you do come to sell, will there be any capital gains tax to pay?

The answer is, possibly not.

If the property has been your main residence at any point and your overall property is less than 0.5 hectares (1.23 acres), you could get an exception to cover part or all of the gain under Principle Private Residence relief (PPR relief).

For those of us that don’t deal with hectares or acres on a daily basis, an average size football pitch is about 1.7 acres and 16 tennis courts fit into acre.

For PPR relief to apply, it should be made sure that the part of the garden being sold is clearly still in use and not fenced off, right up until the sale date. You should also be careful looking into planning permission as if HMRC believe that the land was bought with the purpose of making a profit, they may reject your claim for PPR.

If the subject of this blog is something that you would like to look into, feel free to get in touch with us to look into your personal circumstance.

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