CGT and non-domiciles

Can anyone help me to find out the new rules for CGT and non-domiciles where part of the Estate in the U.K. is a house in which the non-dom has a 50% interest. I have asked two accountants but drawn a blank.

Claire Flood

I have assumed that you are talking about a lifetime disposal by the individual, rather than a disposal by personal representatives.

If it is direct ownership of a UK residential property (ie not through a company/trust/other structure), then the question used to be one of ‘residence’, rather than ‘domicile’.

From 6 April 2015, even non-UK residents are liable for CGT on the disposal of UK residential property, subject to any double taxation agreement. The remittance basis will not be relevant, as the property is in the UK.

My understanding is that if the person making the disposal is non-UK resident, then they have 30 days to submit a return, even if there is no tax to pay. CGT is at 18% or 28% depending on their circumstances. If they were non-UK resident, they should be able to rebase the acquisition value to 5 April 2015, which can be done by way of a ‘straight line’ or ‘actual’ rebasing. The HMRC guidance explains more.

Also, if you are claiming ‘principle private residence relief’ and the person making the disposal was non-UK resident for part of their period of ownership, there are also relatively new rules restricting PPRR in some circumstances:

Paul Davidoff
Moon Beever

Not quite sure to what you are referring.

Recent changes for non-doms and income tax and CGT appear in F (No 2) Act 2017 ss29-33.
See also FA 2018 s.35.

Regarding the non-resident CGT charge on UK residential property interests disposals by non-residents I am unaware of any DTA which would preclude the UK from levying such a charge.

Malcolm Finney

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