What is the definition of a dwelling under TCGA 1992 Schedule B1 paragraph 4?

A dwelling is any building or part of a building used or suitable for use as a residence, including its garden or grounds of a reasonable size. The definition also extends to buildings being constructed or adapted for residential use and land with planning permission for residential development, ensuring incomplete projects fall within scope.

Does land with planning permission for residential development count as a dwelling?

Yes, under Schedule B1 paragraph 4, bare land that has been granted planning permission for residential development is treated as a dwelling for non-resident capital gains tax purposes. This means disposing of a building site with residential planning permission can trigger the same tax treatment as selling a completed home.

What types of properties are excluded from the dwelling definition?

The legislation excludes certain institutional or communal accommodation from the dwelling definition, including residential care homes, homes for elderly or disabled persons, student halls of residence, armed forces accommodation, prisons and detention centres, and hospitals and hospices. These serve specialised institutional purposes rather than functioning as private dwellings.

When was the dwelling definition under Schedule B1 paragraph 4 introduced?

The provision was introduced by the Finance Act 2019, section 13 and Schedule 1, paragraph 10. It formed part of the extension of the non-resident capital gains tax charge to all UK property disposals by non-residents, broadening the scope beyond the previous rules that applied only to residential property.

Taxation of Chargeable Gains Act 1992 Schedule B1 paragraph 4

Meaning of "dwelling"

Schedule B1 paragraph 4 defines what constitutes a "dwelling" for the purposes of the non-resident capital gains tax rules applicable to disposals of UK property interests.

A dwelling includes any building or part of a building that is used or suitable for use as a residence, together with its garden or grounds of a reasonable size.
The definition extends to properties that are in the process of being constructed or adapted for use as a dwelling, meaning that even incomplete residential developments can fall within scope.
Land that has planning permission for development as a dwelling is also treated as a dwelling, capturing sites where residential construction has not yet commenced but has been formally approved.
Certain types of institutional residential properties — such as homes for the elderly, student halls of residence, military accommodation, prisons, and hospitals — are excluded from the definition of dwelling, ensuring that these specialist properties are not caught by the rules.

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