Section 223ZA of the Taxation of Chargeable Gains Act 1992 treats a new home as your only or main residence from the day you acquire it until you move in, provided you move in within the first 24 months, nobody else lives there in the meantime, and the delay ends with the completion of building, renovation, redecoration or alteration work or the sale of your previous home. If you move in later than 24 months, the rule gives no relief for any of the earlier period.

Why is a special rule needed?

Private residence relief normally depends on actual occupation, and the exempt part of a gain is the period of residence over the total period of ownership. A home that sits empty while builders finish it, or while you wait to sell your old house, would otherwise have a chargeable slice at the start of ownership. HMRC’s guidance at CG64477 lists section 223ZA among the few cases where the law deems a house to be your residence without you living there.

Section 223ZA applies to disposals on or after 6 April 2020. For earlier disposals the same ground was covered by extra statutory concession D49 (CG65003). The general working of the relief is in private residence relief explained.

What are the conditions?

Section 223ZA(1), explained at CG65000, has three conditions in addition to the house later becoming your residence:

  1. the moving in time, when the house first became your only or main residence, was within the first 24 months of your period of ownership;
  2. at no time between the start of ownership and the moving in time was the house another person’s residence;
  3. a qualifying event occurred during that period.

Where all three are met, section 223ZA(4) treats the house as your only or main residence from the beginning of your period of ownership until you move in. CG64923 says the period of ownership generally starts on completion of your purchase, not exchange.

What counts as a qualifying event?

Section 223ZA(2) lists two:

  • the completion of the construction, renovation, redecoration or alteration of the house; or
  • your disposal of another house that was your only or main residence immediately before you disposed of it.

CG65000 accepts that several events can occur before you move in, for example building an extension and then redecorating throughout. Provided you move in within 24 months and no one else lives there, the whole delay qualifies.

For the sale of your old home, section 223ZA(3) disapplies section 28, the rule that normally fixes the time of a disposal under contract at exchange. In this context the date the sale actually happens is what counts. That helps where contracts are exchanged well before completion.

HS283 summarises the rule in practical terms: if you cannot sell your old home, or you need to carry out refurbishment, redecoration or alterations, up to the first 24 months can be treated as a period of residence. It adds that the same treatment applies when you complete a house you have built on a plot you own. CG65000 describes the relief as covering the period between acquiring the site and taking up residence in the house built on it.

Is 24 months a cap or a cut off?

It is a cut off. The condition in section 223ZA(1)(b) is that you moved in within the first 24 months. If you move in at month 25, the condition fails and the section does not apply at all, so the whole period before you moved in is outside relief, not just the excess. The final nine months exemption and the absence rules are unaffected, but they do not cover the start of ownership.

The old concession was more flexible in one respect and stricter in another. Under ESC D49 the normal limit was 12 months, extendable to two years only where there were good reasons outside the owner’s control (CG65003 and CG65009). HMRC’s example at CG65009 of a dilapidated house bought in January 2016 and only occupied in May 2019, because of a lack of funds, received no relief before occupation. The statutory rule now gives a full 24 months without needing a reason, but nothing beyond it.

What does the condition about another person’s residence mean?

Section 223ZA(1)(c) requires that the house was not another person’s residence at any time before you moved in. Letting it out while you wait, or allowing a relative to live there, will defeat the relief for the whole pre occupation period. If the house must be occupied for security reasons while work is done, take advice on whether that occupation amounts to someone else’s residence.

Can you get relief on two homes at once?

Yes. CG65013 confirms that where section 223ZA means you are treated as having two residences for a period, no main residence nomination is needed and relief is available on both for that period. HMRC’s example: a man put his home on the market in December 2019, bought a new house in May 2020 but stayed in the old one until it sold in November 2020, then moved. The old house is fully relieved because it was always his only or main residence, and the new house is relieved from May 2020 under section 223ZA. The overlap is relieved on both.

This is different from owning two homes you actually live in, where you may need to choose which is your main residence; see choosing which home is your main residence.

How does it work in practice?

Illustration only. Sam completes the purchase of a run down house in March 2026. Rewiring and a new roof take until December 2027, and he moves in during January 2028, 22 months after completion. No one lived there in the meantime. All 22 months are treated as residence, and if he lives there until he sells, the whole gain is exempt.

Now suppose the work overruns and Sam moves in during May 2028, 26 months after completion. Section 223ZA does not apply. If he sells in March 2036 after ten years of ownership (120 months), the qualifying period is 94 months of actual residence, which already includes the final nine months. The exempt fraction is 94 over 120, so on a £100,000 gain about £21,700 is chargeable.

What mistakes come up most often?

  • Treating 24 months as a maximum relieved period rather than a deadline to move in.
  • Letting the house or allowing a family member to live in it before you move in.
  • Assuming the rule covers a house you bought with no immediate plan to live in it. The house must actually become your residence, and HMRC looks at the quality of occupation.
  • Counting from exchange of contracts. CG64923 says ownership generally starts and ends on completion.
  • Relying on older guidance about the 12 month concession for a disposal made after 5 April 2020.

Periods away from a home after you have lived in it are a separate subject, covered in PRR periods of absence. If you buy a house mainly to renovate and sell, see PRR when you buy a home to renovate and sell. Where any gain is chargeable on a UK home, the 60 day reporting rules apply; see the 60 day property return.

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Reviewed by Christine Anderson, Broker, Solar Protect. Last reviewed 19 October 2026. Part of Accountapedia, the Solar Protect guide to UK tax and accounting. This page is general information, not personalised advice.