Clause 16

Part of Finance (No. 2) Bill – in a Public Bill Committee at 12:00 pm on 26th October 2010.

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Photo of Kerry McCarthy Kerry McCarthy Shadow Minister (Treasury) 12:00 pm, 26th October 2010

Will the Minister clarify that? I am sure that Committee members are familiar with people taking an elderly relative into their home and having what is colloquially known as a “granny flat”—a separate part of the accommodation that is used solely by that relative.

Often these days, with people finding it difficult to get on the housing ladder, young couples move in with their parents—they may have had a child when young—and might live in accommodation that is similarly ring-fenced, with its own bathroom and kitchen. They may pay rent, so that there is a semi-commercial relationship with the owners of the property as well as the family relationship.

Would that also create problems in respect of people’s capital gains situation? If so, can anything be done to deal with that? The spirit of the provisions on capital gains tax properties is that they are designed more for people who own lots of dwelling houses commercially—buy-to-let or whatever; they are not designed to discourage people from taking in family members and giving them a roof over their heads when they need it.