If you have spent the pandemic creating the ultimate home office, you are probably feeling pretty smug. That satisfaction might dissipate somewhat when you try to sell your house, however — and get whacked with a tax bill.
Accountants are warning white-collar workers they are taking a risk, because their new work space may be viewed by HM Revenue & Customs as a business premises, rather than a place of leisure.
Capital gains tax (CGT) is not levied on the sale of your main home, but it is applied to any part of your home used “exclusively for the purposes of a trade, business, profession or vocation”.
In practice, this means the surging number of Covid-19 “offices” that have sprung up all over the country