Capital Gains Tax on sale of home where owner has lived abroad

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Class of 72

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In the Revenue web site section on exemptions from capital gains tax on the sale of a house, under the heading, “Absences considered as living in the property” it is stated:

“You will be considered to have lived in your property where …you had a job, all the duties of which were performed outside the Republic of Ireland.”

This describes my own circumstances. However, while working abroad, I rented my house for a number of years. I am now considering selling it. Does the fact of having rented the house mean that I am liable for capital gains tax should I sell the property at a profit, or am I exempt because I worked outside the Republic of Ireland?
 
Thank you very kindly.

However, beyond the reference I cited from the Revenue we site, I can find no additional information on the question.
 
Class of 72 said:
Thank you very kindly.

However, beyond the reference I cited from the Revenue we site, I can find no additional information on the question.
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Others may well chip in here but otherwise you may need to address this with a professional advisor in the event of an actual or planned disposal of the property in due course.

My understanding is if you move abroad in connection with an employment, the CGT PPR exemption can continue to apply but as with all valuable tax reliefs the devil is in the detail.
 
I think your job has to be transferred abroad - if you move abroad and then find a job, or find a job abroad and then move I don't think that works

But you need proper professional advice on this
 
jpd said:
I think your job has to be transferred abroad - if you move abroad and then find a job, or find a job abroad and then move I don't think that works

But you need proper professional advice on this
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There's actually two distinct situations catered for in section 604(5) - I'll just quote its wording for simplicity, with the two separate situations highlighted:

"(a) In this subsection, "period of absence" means a period during which the dwelling house or part of a dwelling house was not the individual's only or main residence and throughout which he or she had no residence or main residence eligible for relief under this section.

(b) For the purposes of subsections (3) and (4) -

(i) any period of absence throughout which the individual worked in an employment or office all the duties of which were performed outside the State, and

(ii) in addition, any period of absence not exceeding 4 years (or periods of absence which together did not exceed 4 years) throughout which the individual was prevented from residing in the dwelling house or the part of a dwelling house in consequence of the situation of the individual's place of work or in consequence of any condition imposed by the individual's employer requiring the individual to reside elsewhere, being a condition reasonably imposed to secure the effective performance by the employee of the employee's duties,

shall be treated as if in that period of absence the dwelling house or the part of a dwelling house was occupied by the individual as his or her only or main residence if both before and after the period the dwelling house (or the part in question) was occupied by the individual as his or her only or main residence."

The first situation is where the person is employed outside of the State (for any duration, so no 4 year limit), while the second covers a period of absence of up to 4 years during which the owner was prevented from residing at the property due to the location of their employment - this could be because they had to move to the opposite end of the country, for example.

It is important to note the meaning of the term "period of absence" as "a period during which the dwelling house or part of a dwelling house was not the individual's only or main residence and throughout which he or she had no residence or main residence eligible for relief under this section" - the taxpayer is effectively precluded from living in a property that they own elsewhere, as this would constitute a a residence eligible for relief under the section - this is common sense when you think about it, but I'm just pointing it out.

The other requirement for relief under each of the two "period of absence" provisions, is that the individual must have occupied the dwelling house in question as their only or main residence both before and after the period of absence.
 
Thank you very kindly for the precision of your reply. Am I right in concluding that the "period of absence" includes years in which the property was rented while the owner worked abroad?
 
Yes, unless there's a provision in the legislation that specifically withdraws the exemption if the property is let. There's no such provision in the section.
 
Another nuance. Married couple. What if the home is jointly owned, but on moving abroad only one spouse works while abroad? Does the full exemption apply there assuming all other elements are met ?
 
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