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TaxRobin
TaxRobin, Tax Consultant
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Experience:  International tax
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I like to ask couple of questions about the inheritance and

Customer Question

I like to ask couple of questions about the inheritance and capital gain tax.
I am a UK national but was not born in the UK. I became a UK national because my father got his British nationality through naturalisation before I was born. However, I have been living in the UK permanently for over 12 years.
My father left a piece of land in the country where I was born and all my siblings and I have inherited that property. Now, we are trying to sell that land and I like to bring my money to the UK to buy a house. I like to know what do I have to do to make sure that I can bring this money to the UK safely and legally to buy a property here, making sure what I do is fully compliant to the rules and regulations in England.
For the case of my brother, he was born in the UK but have lived most of his life outside the uk for his business purpose. Now, he likes to settle in the uk as his kids (who are also British) are growing up and he also likes to bring the money to the UK that he inherits likewise and he also plan to buy a house in the UK. For his case, is it any different than mine? If so, what else does he need to do?
We are talking about a sum of around £120K for each of our share. Any advice would be helpful please.
Submitted: 2 years ago.
Category: Tax
Expert:  TaxRobin replied 2 years ago.
Hello and thank you for allowing me to assist you.
When you inherit an asset, Inheritance Tax is usually paid by the estate of the person who’s died. You only have to work out if you need to pay Capital Gains Tax if you later dispose of the asset.
You may have to pay Capital Gains Tax even if your asset is overseas.
Capital Gains Tax is a tax on the profit when you sell (or ‘dispose of’) something (an ‘asset’) that’s increased in value.
It’s the gain you make that’s taxed, not the amount of money you receive.
Your gain is usually the difference between what you paid for your asset and what you sold it for.
There are some situations where you use the market value instead. Inherited property is either the tax valuation or market value at date of death.
Your brother is not taxed if he is not resident or domiciled in the UK.
Customer: replied 2 years ago.

I am still not sure about the answer. Could you kindly elaborate on the following please. My father died in 1985 and I would assume that means my mother, brother and I had inherited the property since his death. How is it calculated and how much do i pay now as we plan to sell it.

Do you mean if my brother comes to the uk, planning to settle here permanently and bring the money that he got from selling the property with him here in the UK, then he will not get any taxed at all.

How do i know whether I am uk domiciled or not as I was not born here neither I have any property here. I lived more than half of my life in the country where this property is. I haven't paid tax here as until recently I was a student and my income now is below the tax threshold.

Could you kindly explain please?

Expert:  TaxRobin replied 2 years ago.
You look back at the market value when your father passed. That is your cost. You will pay tax on the gain (difference in cost and sell).
You are domiciled in the UK and your gain is taxable. You live in the UK so you are resident for tax.
Your brother would not have to pay tax as he is not resident in the UK.
Customer: replied 2 years ago.

A final question if you don't mind please. Do you have any idea how much (in percentage) are we talking about for the capital gain tax, for example say I gained about £30 to £50K for that matter.

And when do I declare the capital gain? Before bringing the money or after bringing the money? And who (which professional) do you advice to consult with to proceed with this matter please?

Thank you very much for your help. You have been very helpful.

Expert:  TaxRobin replied 2 years ago.
You would want to use an accountant when you file the self assessment.
£11,000 is your allowance so you would not pay CGT on that amount. The following Capital Gains Tax rates apply:
18% and 28% tax rates for individuals (the tax rate you use depends on the total amount of your taxable income, so you need to work this out first )
28% for trustees or for personal representatives of someone who has died
Customer: replied 2 years ago.

Many thanks. I think this is clear now. Does it however mean that my brother also have to declare the money that he brings with him to HMRC even though he is not a UK domiciled and no tax applies to him? Like me, does he have to get the self assessment done by an accountant as well please or there is nothing to declare to HMRC for this case. Thanks a lot.

Expert:  TaxRobin replied 2 years ago.
Your brother would have no tax reporting requirement. He would not have anything to declare as the property is not in the UK and he is not tax resident.
Expert:  TaxRobin replied 2 years ago.
Customer Last Viewed on 13/11/2014 at 09:39
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