Capital Gains Tax for non-residents: UK Residential property

You will have to notify the HMRC if you have sold or disposed of a UK residential property after 5th April 2015 if you’re a:

·      Non-resident individual

·      Personal representative of non-resent who has died

·      Non-resident who’s a partner in a partnership

·      Non-resident trustee

·      Non-resident company or fund

·      UK resident meeting split year conditions and the disposal is made in the overseas part of the tax year.


Deadline for reporting the disposal and payment


You must notify the HMRC within a 30-day period of conveyance. You must also report the disposal. This can be done through a Non-resident Capital tax return within the same 30-day given period. This is necessary even if:

·      You have no tax to pay

·      You have made a loss

·      You’re already registered for Self Assessment

·      You’re registered with the HMRC for Corporation Tax

·      You send HMRC annual tax on enveloped Dwellings (ATED) or ETED-related Capital Gains Tax returns


If a property is jointly owner, both owners must tell the HMRC about their own gain and loss. Special rules apply to UK residential property exchanged with spouses, civil partners and/or charities.


You may also be able to pay non-resident Capital Gains Tax due within the same 30-day period. Although there are exceptions to the pay now rule if you already have an existing relationship with the HMRC.




If you fail to report your disposal and pay any tax due within the 30-day period of conveyance you will be subject to penalties. The amount of penalty is set at the same as for a late Self Assessment tax return.


Calculating what you need to pay


To calculate your capital gains tax go to the HMRC non-resident Capital Gains Tax Calculator, or contact us now to avoid unnecessary penalties and expense.


Reporting disposals


You must complete a separate return for each disposal, and any amendments you make. When you report a disposal, you must include a computation of your gains and losses with your return.


You are not required to do this if you’re a fund or company claiming an exemption against tax, or if you’ve elected to defer payment.


Capital gains tax for temporary non-resident


There are different rules for those who are a non-resident temporarily. If you qualify (through the temporary non-resident rules) then the portion of gain not charged to the non-resident Capital Gains Tax will come within the scope of the UK Capital Gains tax for the year, or period of return to the UK.


If you do not qualify, as a temporary non-resident there won’t be an additional UK Capital Gains Tax charge for the earlier disposal when you return to the UK.


Individuals are entitled to the Capital Gains Tax Annual Exempt Amount. This can only be used once a year, even if it was a split year.


Representatives of a deceased person who lived abroad


If you’re a personal representative for a deceased person who lived abroad and UK residential property has been disposed of after 5th April 2015, you’ll need to report the disposal to the HMRC.


Capital Gains Tax Annual Exemption Amount is available for disposals in the same tax year as the death or the following 2 tax years.



What is a residential property?


You must notify the HMRC and may be subject to Capital gains tax when you sell or dispose of:

·      An interest in the UK residential property

·      Properties in the process of being constructed or adapted for use as dwellings

·      The right to acquire UK residential property ‘off pan’

·      A UK residential property that isn’t your main jome

·      Your main home if it’s very large or you’ve

o   Let it out

o   Used it for business

o   Had a long period of Absence


What isn’t a residential Property?


The HMRC doesn’t regard the following as residential properties:

·      Care or nursing homes

·      Purpose built student accommodation

·      Building land, provided no residential building is under construction

·      Hospitals or hospices

·      Military accommodation

·      Prisons


Contact us for expert capital gains tax advice