ACCA Advanced Taxation (ATX) Practice Exam

How many additional years are allowed for occupation under the PRR conditional rules for being employed abroad?

1. 4 years

2. 2 years

3. 3 years

4. Unlimited

The correct answer is: Unlimited

The correct choice is that the time allowed for occupation under the Private Residence Relief (PRR) conditional rules for being employed abroad is unlimited. This reflects the fact that individuals who are temporarily working outside the UK and maintaining their residence can benefit from PRR, which allows them to treat their property as their main residence regardless of the duration of their employment overseas. This provision is particularly important for those who might be relocating for work without selling their main home, as it ensures they remain eligible for relief on any capital gains when they eventually sell the property. This unlimited period acknowledges the diverse nature of employment situations, enabling those who may need to stay abroad for extended periods due to their job to retain relief benefits without a strict time constraint. The other options, which indicate limited years (2, 3, or 4), do not reflect the law as it stands regarding PRR for individuals employed abroad, which permits a prolonged status for tax benefits related to their primary residence.