Selling a Home With a Garden Gym or Training Studio: Private Residence Relief, Exclusive Business Use and the Half-Hectare Limit

A well-equipped garden gym can add to a home’s appeal, but if it is used to run a business, the tax position on selling the home can change. HM Revenue and Customs (HMRC) publishes GOV.UK guidance and a self-assessment helpsheet (HS283) on Private Residence Relief, the relief that normally removes Capital Gains Tax on a sale of the only or main home. This article summarises what those documents say about exclusive business use, buildings in the garden and the size of the grounds, using the 2025 edition of the helpsheet. It applies to UK taxpayers and is general information, not tax advice. This site’s guide to working from a home gym as a sole trader covers simplified expenses and a shorter summary of the same relief.

When no Capital Gains Tax is due

GOV.UK says a person does not pay Capital Gains Tax when they sell their home if all of the following apply:

• they have one home and have lived in it as their main home for all the time they have owned it;
• they have not let part of it out, though having a lodger does not count as letting;
• they have not used a part of the home exclusively for business purposes, and using a room as a temporary or occasional office does not count as exclusive business use;
• the grounds, including all buildings, are less than 5,000 square metres (just over an acre) in total; and
• they did not buy the home just to make a gain.

If all apply, GOV.UK says the relief is automatic and there is no tax to pay. If any apply, some tax may be payable.

Exclusive business use

HS283 says that if part of a dwelling house is used exclusively for a trade or business, that part does not qualify for relief. Its example is a house consisting of a shop with living accommodation above: relief is available only for the living accommodation, and a gain on sale is split between the shop, which may be chargeable, and the living accommodation. The helpsheet also states the counterpart: working from home in a room that is also used for non-business purposes does not prevent entitlement to full relief.

The word “exclusively” therefore carries the weight. A room that is only ever used for the business is treated differently from one that also serves as, for example, the household’s own exercise space. Which side of that line a particular garden building falls on depends on how it is actually used.

Buildings in the garden

HS283 explains that a home can be a single building, more than one building, or part of a building, and that if a home has several outbuildings, relief for the dwelling house might not extend to all of them. Its example is a house with a detached garage, a granny flat, half an acre of garden and a summer house at the end of the garden: the dwelling house is the house, garage and granny flat, but excludes the summer house. That distinction matters only when the grounds are larger than the permitted area, because the helpsheet says the garden or grounds include the buildings standing on that land. A building that is not part of the dwelling house can therefore still qualify if it is within the permitted area of the garden or grounds.

The permitted area

HS283 says that if the garden and grounds do not exceed half a hectare, which is a little over one acre, relief is available for all of it. In its example, the summer house is not part of the dwelling house, but because the grounds do not exceed half a hectare it still attracts relief. If the grounds exceed half a hectare, relief may not cover all of them. The helpsheet also says relief is not available for land let or used for a business, such as surrounding farmland, and that land fenced or divided off from the garden for development, or developed or in the course of development at the time of disposal, does not qualify.

What a partial claim involves

HS283 says that where part of a home is used exclusively for business, or part has been let, the gain is split between the chargeable business or let part and the exempt living accommodation. It notes that taxpayers who do not meet all the conditions may still get partial relief in some circumstances and would need to complete the Capital Gains Tax summary pages of their tax return.

Practical points for someone planning to sell

• Note how each room or building has been used over the whole period of ownership, since the conditions refer to that period.
• Check whether any part has been used exclusively for the business, as opposed to shared use.
• Check the total size of the grounds, including all buildings, against the half-hectare limit.
• Read the current version of HS283 and GOV.UK’s page before selling, and consider professional tax advice.

Frequently asked questions

Does working from home spoil the relief?

Not by itself. GOV.UK says using a room as a temporary or occasional office does not count as exclusive business use, and HS283 says working from home in a room also used for non-business purposes does not prevent full relief.

The bottom line

For a home with a garden gym, the key questions in HMRC’s guidance are whether any part has been used exclusively for business, whether all the buildings are within the permitted area and whether the home has always been the owner’s main residence. Shared personal and business use of a room does not by itself prevent full relief, while exclusive business use of a part can make that part chargeable. Anyone selling should check the current HMRC pages and take tax advice.

Sources

• GOV.UK, “Tax when you sell your home: Private Residence Relief”
• HM Revenue and Customs, “HS283 Private Residence Relief (2025)”