UK Non Resident ? UK Home Owner? This could affect you !!
by Alexander Beard, on Aug 24, 2015 6:39:55 AM
From 6th April 2015 we saw the introduction of new Capital Gains Tax Rules for Non-Resident UK Property Owners. Prior to this date UK non-residents were not liable to Capital Gains Tax on the sale of UK property.
However the UK Government has introduced new rules whereby non-resident property owners will now have to pay Capital Gains Tax when they sell their property in the UK.
All Capital Gains will be payable from 6th April 2015 onwards on gains arising after the rebasing date of 5th April 2015 (rebasing is the value of your property on 6th April 2015). They will assess gains from the 5th April 2015 and not prior to that date.
The Government advises UK non-resident property owners to record the condition and value of their property as at 5th April 2015.
Therefore it would be prudent to commission a professional valuation to make a formal and reasoned record of the value on this date. Going forward, this could avoid debate in 10-20yrs time.
The Government's guidance states that the rate of Capital Gains Tax for non-resident property owners will be the same as for nationals: 18% or 28% for individuals, 28% for trusts, and the annual exempt amount will be the same i.e.; £11,100 for 2015/2016
When property is sold in the UK the vendor (you) now has to report the disposal on a NRCGT (Non Resident Capital Gains Tax) return and pay any Capital Gains Tax due within 30 days of the day after the date the property sale is completed, or if they are already enrolled in the UK's Self-Assessment they pay this as part of the normal end of year tax payment. There are options to assess any potential gain. Depending on your situation choosing the correct option may lower any tax liability.
You may also be able to implement PRR (Private Residence Relief) if you can prove residency over 90 midnights in the tax year.
It's a complex area and one you should plan for, if appropriate to you. Best to avoid any nasty surprises.
If you would like the UK Government's Q&A answer PDF on the subject or have any questions please do get in touch.
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