Capital gains tax advice for non-UK residents

If you live overseas, own rental property in Britain and are thinking of disposing of it, we’ll make sure that your tax bill is reduced as much as possible.

Simon Thandi, UK Landlord Tax

Hi, I’m Simon.

I’m one of the Directors of UK Landlord Tax and I’m also a landlord myself. Capital gains tax is one of the complexities that can make owning property in the UK a challenge, especially if you’re based overseas. It’s vital to be aware, build a strategy and to get expert advice. Our team are ready to answer your questions about CGT right now – give us a call.

Don’t let CGT make selling your UK property a chore

We make non-resident CGT easy by…

Calculating your capital gains tax

Knowing what your capital gains tax liability is before you sell is vital. We can provide you with an estimate of the tax liability and discuss your options. If you have already sold the property, a CGT calculation will need to be carried out. You must also report the gain made and pay any tax due to HMRC within 60 days of completion of the sale.

Putting together a strategy

Owning property in the UK is just one part of your overall tax situation. We’ll work with you to identify opportunities to keep your UK tax bill down by making sensible choices about business structures, ownership and available allowances.

Dealing with HMRC

Thorough paperwork and detailed records will head off most questions the UK tax authorities are likely to raise about your property income. If the taxman does ask for more information, we’ll supply it – talking their language and understanding their intent if there’s an investigation, we’ll be right there, on your side.

Download our FREE UK Property Tax Guide.

A simple guide to property rental income tax and property capital gains tax for UK Landlords.

Current tax rules

Dealing with HMRC

How our tax system works outside of PAYE

Frequently asked questions

Can I claim Rollover Relief?

Rollover Relief is available on furnished holiday lettings and on certain trading assets. If you reinvest all or some of your proceeds, you may be able to defer the gain by claiming rollover relief.

Rollover relief however is not available to most landlords as BTL property is not included under the relief.

How do I report and pay CGT?
For non-UK residents, the disposal of all properties must be reported and the Capital Gains Tax paid within 60 days of the completion of the sale whether or not there is a liability to Capital Gains Tax.

For detailed guidance on the new rules please read our guide.

I am non-resident how much CGT do I pay?

As a non-resident, if you owned the residential/commercial property at 5th April 2015/5th April 2019 then you can use the value as at 5th April 2015/5th April 2019 as the base cost when calculating CGT to work out your capital gains tax.

Please see the following for more detailed guidance.

What tax relief or allowances do I get when I sell my property?

There is an annual capital gains tax allowance which is £12,300 for 2020/21 to 2025/26 for everyone.

You will also get Principal Private Residence relief for any period of time you have lived at the property as your main residence plus the final 9 months. To claim Principal Private Residence relief in any year after 6th April 2015, you have to be resident in the property for at least 90 days in the relevant tax year. So it is unlikely that you will receive any relief whilst you are overseas but you may be entitled to the final nine months plus the period that you occupied the property whilst you were living in the UK.

Can I avoid Capital Gains Tax?

In certain circumstances you may be able to reduce or avoid entirely any capital gains tax. For example:

Mrs Jones owns a property in her own name. It may be an idea to transfer the property into joint names with Mr Jones before a sale assuming that Mr Jones has not already used his CGT exemption in the tax year concerned. You do have to take into account the levels of income of each partner because the rate of capital gains tax for one partner may be higher than that of the other partner. Care does need to be taken as if this is carried out shortly before a sale, then HM Revenue and Customs may attack the transaction as invalid under anti-avoidance rules. You also need to ensure that any income received in the period after transfer of the property is declared on each spouse’s tax return which may increase the income tax paid. There would also be the costs of conveying the property into joint names.

What is Principal Private Residence Relief?

Principal Private Residence relief is a tax relief given on the sale of a property which has at any time during your ownership been occupied as your main residence.

Please read the our guide.

I am divorcing. Where do I stand with Capital Gains Tax on transfers of property to my ex-partner?

Going through a divorce can be a stressful time so it is vital that you seek professional advice.

If you are in the process of divorce, the period of CGT relief between spouses is extended but only until the end of the tax year of separation. For more detailed information on this please see the following guide.

Do limited companies pay Capital Gains Tax?

No. Companies pay corporation tax. If you hold property in a company and make a sale, the profit is subject to corporation tax at 19%.

From 1st April 2023, the Government have proposed that the first £50,000 will be taxed at 19%, the next £200,000 will be taxed at 26.5% and the remaining profits will be taxed at 25%. Where companies are under common control the bands are shared equally between each of the associated companies. 

Fees for non resident  capital gains tax

If you have sold a property or are looking to sell a property please do not delay, get in touch straight away so we can advise you accordingly. Our fees will vary depending on the complexity of your situation, but don’t worry – we’re always focused on offering great value, accuracy and efficiency.

Get in touch for a quote

If you drop us a line, by email or phone, and tell us a bit about your situation, we’ll talk you through what we can do for you and how much it might cost. You may just need a Capital Gains Tax computation or a more comprehensive service involving any subsequent submissions to HMRC on your behalf. Either way, our expert team will be able to talk you through the process.

Let‘s talk about property tax today

When it comes to fixed-fee tax returns for UK landlords, nobody does it better.

Our non-resident CGT service is for you if…

You might one day want to sell UK property

Knowing you might sell one day gives you an advantage and it’s never too soon to plan, making smart decisions that will help you manage your capital gains tax bill down the line.

You want to sell UK property now

If you’ve got a house or flat in Britain and are in the process of preparing to sell, talk to us today about how to make sure the disposal doesn’t cost your more than it ought to in tax. And you never know – our passion for letting and tax expertise, might convince you that it’s worth keeping hold of it after all.

You’re a property investor

If you’re an overseas property investor building and managing a portfolio in Britain, we can help manage capital your capital gains tax bill as part of a big-picture approach to tax planning. From business structures to allowances, UK Landlord Tax will make sure that being involved in the UK property market works for you.

a man in glasses smiling

What a refreshing experience

“We are overseas and have a property in the UK. We had a stressful time finding a suitable firm to look after our affairs... What a refreshing experience to find a company that was so helpful, so considerate, and took time to listen to our concerns. Nothing was too much trouble for them. They have just completed my tax return and although I had issues trying to find my way around portals and so on, they were magnificent in guiding me through what I considered to be a maze."

A Jones, July 2019

Via FreeIndex, edited for clarity

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Jennie, UKLandlordTax

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Call us now on 01902 711 370
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