If you dispose of a residential property in the UK, you are liable to tax on the Capital Gain. If you owned the property at 5th April 2015 then the assessable gain is for the period from 5th April 2015 to the date of disposal.
Private Residence Relief may be available if you have lived in the property at any time and the annual exemption is available to set off against the gain. If you owned the property on 5th April 2015, you can either:
If the property was your principal private residence at any time prior to 5th April 2015 then you can claim the last 9 months as Private Residence Relief on a time apportionment basis (If the disposal took place before 6th April 2020 the Private Residence Relief is 18 months and Lettings Relief is available if the property was let out).
The elections in 2 and 3 are irrevocable once made.
If you dispose of a commercial building, land or shares in a company where you own 25% or more of the shares and 75% or more of the company’s assets are land and/or buildings in the UK, you are liable to tax on the Capital Gain. If you owned the property at 5th April 2019 then the assessable gain is for the period from 5th April 2019 to the date of disposal.
You can either:
If you are non-resident for less than five whole tax years any capital gains which you make on any other assets (which are not dwellings sold after 5th April 2015, other immovable property sold after 5th April 2019 or assets used in a trade in the UK) whilst abroad, may be taxed in the year you return unless those assets were acquired and disposed after you became non-resident.
Apart from dwellings sold after 5th April 2015, other immovable property sold after 5th April 2019 or assets used in a UK trade and you returning to the UK within 5 tax years, there is no Capital Gains Tax if you are a non-resident.
YOU MUST MAKE A RETURN AND PAY ANY CAPITAL GAINS TAX DUE ON THE DISPOSAL OF ANY LAND OR BUILDINGS WITHIN 30 DAYS OF THE DATE OF COMPLETION OF THE SALE. The return has to be made whether you complete a self-assessment return or not.
If you complete a self-assessment return you will need to declare the gain on the return and if there is any additional tax to pay because you used estimates in the CGT Return, the additional tax is due on the normal date of 31st January after the end of the tax year in which the disposal takes place. Prior to 6th April 2020, if you completed a self assessment return, the tax did not have to be paid until 31st January following the end of the relevant tax year.
You should also confirm your tax reporting requirements in the country where you reside with a local tax adviser.
© Thandi Nicholls Ltd 2020 All Rights Reserved - The above articles are provided for guidance only and may not cover your personal circumstances so you should not rely on them. It is important that you seek appropriate professional advice which takes into account your personal circumstances where you can provide the full facts of the case and all documents related to your case. Thandi Nicholls Ltd t/a uklandlordtax.co.uk, K Nicholls FCA or S Thandi cannot be held responsible for the consequences of any action or the consequences of deciding not to act.
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