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taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 4795
Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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I sold a property in France in 2013 which I had owned since

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I sold a property in France in 2013 which I had owned since 2002. I paid the French CG when I sold it. On my tax return I have filled in the computation paper with all relevant figures. However how do I know that the CG already paid has been taken into account, I entered the CG paid in the section which asked this question 'Description of elections made and of reliefs claimed or due. Where applicable, give the amount:' Is this correct?
Once I had completed the computation paper and moved on I was given a figure of capital gains. Will I pay another amount of UK CG on that total?
Submitted: 2 years ago.
Category: Tax
Expert:  taxadvisor.uk replied 2 years ago.
Hello and welcome to the site. Thank you for your question.

Once you have completed all sections dealing with capital gains tax on foreign investments and also shown the tax suffered in that country, the final computation should reflect foreign tax credit relief in arriving at additional capital gains tax due to HMRC.

Effectively, you are paying CGT on that gain to UK tax authorities but are also getting foreign tax credit relief against tax suffered in that country.

Please ensure you have ticked box 38 "To claim Foreign Tax Credit Relief put X in the box"

I hope this is helpful and answers your question.

If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.

Customer: replied 2 years ago.

Hi, Thanks, ***** ***** completing on line and cannot see a Q 38. I have shown the tax paid in the computations There is a Q about adjustments is that the Q 38 or is it elsewhere?

Expert:  taxadvisor.uk replied 2 years ago.
Rod, thank you for your reply.

Looking at my online submission forms (commercial software) ... within supplementary pages (foreign) there are boxes 33 to 40 to cover capital gains - foreign tax credit relief and special withholding tax.
box 37 - foreign tax paid
box 38 - to claim foreign tax credit relief put a tick in the box
box 39 - total foreign tax credit relief on gains

I hope this is helpful
Customer: replied 2 years ago.

Sorry to be a pain,

I am using the HRMC software and it has no Q numbers. It looks as if it is a very simplified version with specific questions left out of the on line version, as in your 37-39.

I have completed the return (not submitted) and it has given me a figure of tax owed. If I calculate at 18% I get a tax payable of £3600, on the CG. However the software seems to have made adjustments on the information given resulting in a payment of £747 due. I will submit it and wait and see. However if you can give me any other ideas please let me know!

As an observation It does seem to me that we have a mismatch between the information you have on commercial software and the HMRC software which I as a one off CG payer have used. The descriptions bear no relationship to each other.

Cheers

Rod

Expert:  taxadvisor.uk replied 2 years ago.
Rod, thank you for your reply.

I have quoted you box numbers from HMRC forms that you can download from their site.

Here is supplementary pages SA106 that covers foreign income and gains

http://www.hmrc.gov.uk/forms/sa106.pdf

I have to be honest and say that I don't use HMRC software for filing client tax returns.

If I were you, I would also make a note of foreign tax suffered on the capital gain in the main section of the tax return under heading "Any other information" in case there are enquiries.

I hope this has been helpful.



Customer: replied 2 years ago.

Thank you for your help, I think I have it sorted now! I do have one final question.

I receive a state pension and HM software shows this as £114 (weekly figure) a figure I have to confirm. Do I need to multiply that by 52 for the return or leave it at £114-00? This is what the help page says




State Pension (the amount due for the year)


The figure of taxable State Pension has been provided by the Department for Work and Pensions (DWP) and is the figure of your weekly entitlements, even if you were paid monthly or quarterly.



Expert:  taxadvisor.uk replied 2 years ago.

Rod, thank you for your reply.

The pre-populated pension figure in the online return is provided by the Department for Work and Pensions. If the taxpayer or agent disagrees with the entry it can be overwritten. In such a case the online calculation will use the agent’s entry. HMRC recommend that if the figure is overwritten that an explanation is provided in the ‘white space’ box on the return.

Unless you disagree with the figure, I would leave it as is.

I hope this is helpful and answers your question.

taxadvisor.uk, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 4795
Experience: FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
taxadvisor.uk and 2 other Tax Specialists are ready to help you
Expert:  taxadvisor.uk replied 2 years ago.
I thank you for accepting my answer.

Best wishes.

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