In April 2015, new rules came
into effect for all overseas UK
property owners.
Capital Gains
Tax Update
for ExPats selling
UK property
The rules
affecting
Capital Gains
Tax obligations
changed in April
for exPats
selling property
in the UK.
Up until 5th April, most exPats
were able to sell their final UK
property without incurring Capital Gains Tax charges. Now, the
rules have changed and most of
us will be liable to pay tax when
we make that final decision to
sell up in the UK.
Capital Gains Tax may be payable on UK residential property
disposals by:
• non-resident individuals
• personal representatives of
non-residents who have died
• any non-residents who are
partners in a partnership
• non-resident trustees
• non-resident companies or
funds
If a property was jointly owned
each owner must tell HMRC
about their own gain or loss.
If you are a non-UK resident you
pay Capital Gains Tax on the
gain when you dispose of:
• a UK residential property that
isn’t your main home
• your main home if you’ve let it
out, used it for business, had
long periods of absence or it’s
very large
• an interest in either of the
above
• properties in the process of
being constructed or adapted
for use as a dwelling
• the right to acquire a UK residential property ‘off plan’
by Gaile
Griffin Peers
If you have only just left the UK
and are just registering as a resident here you may be able to
claim exemption as you don’t
pay Capital Gains Tax when you
sell (or ‘dispose of’) your home if
all of the following apply:
• you have one home and
you’ve lived in it as your main
home for all the time you’ve
owned it
• you haven’t let part of it out,
this doesn’t include having a
single lodger
• you haven’t used part of it for
business only
• the grounds, including all
buildings, are less than 5,000
square metres (just over an
acre) in total
• you didn’t buy it just to make
a gain
In these cases, you don’t need
to do anything. You’ll automatically get a tax relief called Private Residence Relief. If you
don’t meet all these criteria you
may have to pay some Capital
Gains Tax.
Married couples and civil partners can only count one property as their main home at any one
time.
As a non-UK resident you will
only get Private Residence Relief on a UK residential property
if:
• you or your spouse or civil
partner were living in the UK
for that tax year
• you or your spouse or
civil partner stayed overnight
at the property at least 90
times in the tax year (the 90
day rule)
• If you only owned the property for part of the year, the 90
days are time apportioned in
line with the time you were the
owner. You will also get Private Residence Relief if the