If you’re planning to sell your home in Ireland, Principal Private Residence (PPR) Relief could mean you don’t have to pay any Capital Gains Tax (CGT) on the profit. In simple terms, PPR Relief is a tax exemption offered by Revenue if the property you’re selling was your main residence for the time you owned it.
This guide will explain exactly how it works, who can claim PPR relief, what exceptions exist, and what records you’ll need.
What Is Capital Gains Tax (CGT) in Ireland?
Capital Gains Tax is a tax you pay when you make a profit (or gain) from selling something valuable, including residential property. If your home increased in value since you bought it, that profit is normally taxed at 33%.
But here’s the good news: if the house you’re selling was your Principal Private Residence, you may get full or partial exemption from capital gains tax.
How Principal Private Residence Relief Works?
To qualify for full PPR relief, you must have:
- Owned the dwelling house
- Lived in the property as your main home
- Used all parts of the house as your private residence
Additionally, land up to one acre surrounding the house is covered too but the site of the house is excluded when applying the relief.
Even if you’ve moved out, the last 12 months of ownership are still counted as residence. This helps when you’ve bought a new home but haven’t yet sold the old one.
What Is The Eligibility Criteria for PPR Relief?
You’re generally eligible to claim PPR relief if:
- The property was your only or main residence throughout the period of ownership
- You didn’t use any parts of the house exclusively for business purposes
- You didn’t let out the property (unless under Rent a Room Relief)
- You weren’t away for long — unless due to:
- An employer requiring you to work elsewhere (up to 4 years)
- Employment where all duties were performed outside Ireland
- Being in a nursing home or retirement facility
If you meet these conditions, your gain may be fully exempt from CGT.
Partial PPR Relief: When Full Exemption Doesn’t Apply
Relief is restricted in two main cases:
- If you did not always live in the property
- If you used parts of the house for something else, like a home office or rented room not covered by Rent a Room Relief
In these cases, you can still claim partial relief.
For example:
If you owned a home for 10 years but lived in it only for 7 years, plus 12 months’ grace, then you can claim relief for 8 out of 10 years (80%).
Another case:
If you used 20% of your home exclusively for a business (like a treatment room), you can only claim relief on 80% of the gain.
PPR Relief for Married Couples, Civil Partners, and Joint Owners
If a property is jointly owned by married couples or civil partners, and it was their main residence, both may benefit from PPR relief.
However, the rules apply to each owner individually based on their months of ownership and residence.
Example:
- If one partner lived in the home for the full duration, but the other only part-time, their relief percentages may differ.
Letting Relief: How It Works with PPR (If at All)
Ireland does not offer a separate letting relief like the UK. However, certain absences (e.g., required job relocation or care in a hospital) are treated as if you still lived in the property.
Important: If your home was rented out for a time, that period won’t qualify unless it meets one of the specific exceptions.
How to Claim PPR Relief in Ireland?
To claim PPR Relief, you need to:
- Work out your chargeable gain:
- Sale price minus purchase price
- Deduct allowable expenses like solicitor or auctioneer fees
- Calculate the portion of time the property was your main home (include the final 12 months).
- If your property had development value, work out your notional gain based on the home’s current residential use only.
- Submit a CGT return with the relief claimed.
- Keep supporting documentation, including:
- Purchase & sale contracts
- Dates of occupation
- Utility bills or other residence proof
- Business use evidence (if any)
Differences Between PPR Relief in Ireland vs UK
If you’ve lived in both countries, note the key differences:
| Feature | Ireland | UK |
| Last months of relief | 12 months included | 9 months included (recent update) |
| Letting relief | Very limited, case-specific | More structured letting relief available |
| Business use | Reduces relief if area used exclusively | Similar impact, but slightly different rules |
| Retirement home absences | Qualifies for deemed residence | UK rules more limited in this respect |
Always check with a tax advisor if you’ve had property in both regions.
Penalties, Pitfalls, and Revenue Scrutiny
Mistakes can be costly. Revenue may question:
- Incorrect apportionment of business use
- Overlooking the 12-month final ownership rule
- Not including solicitor or agent fees
- Claiming full relief when you only had partial residence
Late filing or payment of CGT also leads to penalties and interest.
Make sure your records clearly support your claim especially if claiming partial relief or dealing with development value.
Get Professional Help
If you’re unsure how to calculate your partial relief, or whether a nursing home stay qualifies, it’s wise to speak to a tax professional.
J Maguire – Accounting and Taxation Professionals in Ireland can help you assess your situation and ensure you’re compliant with Revenue guidelines while maximising your relief.
Key Takeaways
- PPR Relief can fully or partially exempt you from capital gains tax on your main home
- To qualify, the property must have been your principal private residence during ownership
- Relief applies to land up to 1 acre, excluding the house site
- Absences for work abroad or medical care may still qualify
- Using parts of the house for business or letting may limit your exemption
- Calculate notional gain if selling with development value
- Keep records of occupation, expenses, and use of property
- Relief must be claimed in your CGT return
Frequently Asked Questions
Q1. Do I have to live in the house the entire time to get PPR Relief?
No, but relief is limited to the period you lived there (plus the final 12 months).
Q2. Does renting out a room affect my relief?
Not if you qualify for Rent a Room Relief. Otherwise, it may reduce your claim.
Q3. What if I moved abroad for work?
Absences for work abroad may still count as occupation, up to 4 years.
Q4. Can I claim relief if I lived in a nursing home?
Yes, time in a nursing or retirement home is treated as occupation.
Q5. Do I need to submit documents when filing CGT?
Yes, keep and include relevant documents like proof of residence and sale costs.
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