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TonyTax
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15946
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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I sold a house in Jan 2014. It was my home from 1990, when

Resolved Question:

I sold a house in Jan 2014. It was my home from 1990, when I bought it, until 1998 at which point I went overseas and rented it out. I have calculated my CGT liability myself and have a sheet but would like someone to look over it to make sure I have applied the reliefs/allowances correctly and that it is in a format which will be acceptable to HMRC.
Submitted: 2 years ago.
Category: Tax
Expert:  TonyTax replied 2 years ago.
.

Would you like to upload the sheet please.
Customer: replied 2 years ago.

,

I can't actually see where I can upload?

Expert:  TonyTax replied 2 years ago.

You should see a paperclip icon or something similar. Alternatively, scan and email it to just answer and ask them to send it to me, TonyTax in the UK tax section.

Customer: replied 2 years ago.

Attachment: 2015-01-22_181929_cgt_schedule.xlsx

I can't see that this went the first time, did you get it?

Expert:  TonyTax replied 2 years ago.
Thanks.

Leave it with me while I take a look. I may have a question or two .
Expert:  TonyTax replied 2 years ago.
again.

What were the circumstances behind your move abroad?
Customer: replied 2 years ago.

I went to work in Tokyo, came back in 2012 and started working in UK again.

Expert:  TonyTax replied 2 years ago.
Thanks. Did you go to live and work Tokyo of your own volition or were you sent there by your employer? When you returned to the UK did you move back into the UK property? Was your income in 2013/14 more than £41,450?
Customer: replied 2 years ago.

I went of my own volition, I didn't move back into the property when I came back and yes, my income was more than that amount.

Expert:  TonyTax replied 2 years ago.
Thanks.

Leave this with me bit while I draft an answer.
Customer: replied 2 years ago.

Ok, thanks.

Expert:  TonyTax replied 2 years ago.
again.

There is the possibility of claiming private residence relief whole period of your absence from the UK under Section 223 Taxation of Chargeable Gains Act 1992 which you can read about here, here and here. You must have been employed abroad as opposed to self-employed and had no other home eligible residence relief in Japan. See the third link other conditions. The one you may fail on is that you didn't reoccupy the property when you returned to the UK. It does not matter that the property was let during your absence.

If you cannot claim overseas absence relief, then your calculations look fine so long as you got the length of the period of occupation right and that you haven't double counted the last 36 months, ie no part of the last 36 months is included in the period of 92 months..

I hope this helps but let me know if you have any further questions.
Expert:  TonyTax replied 2 years ago.
I have to go out short while but I will be back to answer questions that you may have.
Customer: replied 2 years ago.

there,

I have followed the links you sent me, and note that if

"The individual was prevented from returning to the dwelling house as a consequence of the individual’s employment requiring them to reside elsewhere or as a condition reasonably imposed to secure the effective performance of the employee"

Then the requirement to reside in the property after an absence may be excused.

When I returned to UK I was initially without my family and working in the Financial District, I had to start work at 7am and rented a flat near to the office and also near to where my major client lived so that I could see/entertain him regularly.

I should also mention that I had bought a family house in the UK in 2010 as a rental property and possible future family home and I have in fact resided in this house with my family since February 2014. It was when I knew that they were coming to the UK that I sold the property in question as it was going to be too small all to live in.

Am I stretching the point here or do I have a case relief do you think?

If I do have a case, I guess I need to contact HMRC as it is a bit grey?

No need to answer immediately, I am going to be away from my computer until tomorrow morning.

Expert:  TonyTax replied 2 years ago.
Can you tell me when you returned to the UK and where you lived. Were you in rented accommodation? How far from the house sold in January 2014 did you work on your return to the UK?
Customer: replied 2 years ago.

I returned to the Uk in April 2012 and lived in a rented flat in Clerkenwell, which was about a mile from my office - walkable. My house was about 8 miles away from work

Expert:  TonyTax replied 2 years ago.

I'm afraid that the tax office almost certainly won't consider an 8 mile distance from your home to your office as sufficiently large to warrant you not returning to live in the property that you have sold. You could take one of three courses of action:

1 Claim main residence relief entirety of your ownership on the basis of absence abroad. HMRC may ask you to justify your claim and disallow it in which case, you would owe alot of tax and will be hit with interest charges and related penalties payment. Any 2013/14 tax not paid by 28 February 2015 will have a 5% surcharge added, another 5% surcharge will be added to any tax unpaid /14 as at 31 July 2015 and another 5% surcharge will be added to any unpaid 2013/14 tax as at 31 January 2016. Take a look here information.

You could buy a certificate of tax deposit to protect against the penalties and interest. If the tax becomes due, the date of purchase of the CTD will be the effective date of payment of the tax. Take a look here information.

2 Call the tax office, ask to speak to a technical officer and get their view. I'm pretty sure they will say you cannot claim absence relief. If youi give your name, you will alert them to a potential claim in any event and they will mark your file.

3 Submit your tax calculation as is and not claim absence which I'm doubtful you will get.

If the tax office don't enquire into your tax return within 12 months of receiving it, they are out of date to do so.

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