Meaning of “the relevant period of ownership” etc.
520The relevant period of ownership
The relevant period of ownership is the period beginning—
(a)with the day on which the dwelling-house was first used for any purpose, or
(b)if the relevant interest in the dwelling-house has been sold after that day, with the day following that on which the sale (or the last such sale) occurred,
and ending with the day on which the balancing event occurs.
521Starting expenditure
(1)This section gives the starting expenditure attributable to a dwelling-house for the purposes of section 517.
(2)If the person to or on whom the balancing allowance or balancing charge falls to be made is the person who incurred the qualifying expenditure attributable to the dwelling-house, that expenditure is the starting expenditure.
(3)Otherwise, the starting expenditure is the residue of qualifying expenditure attributable to the dwelling-house at the beginning of the relevant period of ownership.
(4)If section 528 (treatment of demolition costs) applies, the starting expenditure is increased by an amount equal to the net cost of the demolition.
522Adjusted net cost
The amount of the adjusted net cost in relation to a dwelling-house is—
where—
S is the starting expenditure attributable to the dwelling-house,
P is the amount of any proceeds from the balancing event,
I is the number of days in the relevant period of ownership on which the dwelling-house was a qualifying dwelling-house, and
R is the number of days in the whole of the relevant period of ownership.