Non-Residents and UK Capital Gains Tax

Currently if you are non-UK resident and have disposed of any assets, no capital gains tax will be payable provided that you do not return to the UK for at least 5 complete tax years, following the tax year you left the UK.

Changes from 6 April 2015

With effect from 6 April 2015, capital gains tax will be payable by certain non-resident individual, trustees and non-resident companies on sales of UK residential property.

What will be taxable?

Capital gains tax will be payable on the gain realised on sales after 5 April 2015 on the uplift in value from 5 April 2015.

Any periods of non-residential use of the property can be excluded from the calculation.

Tax Rates

Individuals that are basic rate taxpayers will pay capital gains tax at 18%, thereafter at 28%. If the disposal relates to a non-resident deceased person the capital gains tax rate will be 28%. Individuals will be entitled to the annual exemption (reduces the taxable gain). £11,000 for 2015/16. Non-resident companies will pay corporation tax at 20%.

How to report the UK residential Property disposal

All UK residential property disposals will need to be reported on a Non Resident Capital Gains Tax (NRCGT return). Both the return and payment (if any) of capital gains tax will fall due within 30 days from the day after the disposal of the property. If an individual is within self-assessment, the gain will be reported on both the self-assessment tax return and the NRCGT return will still be due. However the payment will form part of self-assessment tax payment deadlines. Further details on the reporting will be published by HMRC after 5 April 2015. The treatment of losses generated from the disposal of a property will depend on the individual’s residency status.