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For many years my client and her husband lived in an old bungalow that they owned jointly. They needed more space so demolished the bungalow and moved into the garage which they converted to accommodate them while the new house was being built on the site of the previous home. After more than ten years the new house is almost ready but recently the couple have separated and divorced.
As part of the divorce settlement the ex-husband took his name off the property deeds and in turn received £200 000. He now lives with his new wife in her home which he does not own.
My concern is that HMRC may take the view that because he did not live in the new house he may not qualify for only or main residence relief on his half share or for relief under TCGA 1992 ...
