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bigduckontax, Accountant
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. I have an enquiry about non-resident taxation when disposing

Customer Question

Hi. I have an enquiry about non-resident taxation when disposing UK property registered offshore. So the property was registered in 2010 on off-shore company and was rented out since then. I have applied for non-resident scheme and was paying tax on rental income. With changes to the law, what are the tax consequences when selling the property? Do i pay the tax on capital gain? Do I need to valuation? Thank you
Submitted: 2 years ago.
Category: Tax
Expert:  bigduckontax replied 2 years ago.
Hello, I'm Keith and happy to help you with your question.
Firstly you do need a valuation as at 6 April 2015 for reasons I will explain later. The general consensus of advice is that you should obtain more than one valuation. The rules changed with the Finance Act, 2014 and taxation is levied on residential property or property capable of being residential.
You will be liable to Capital Gains Tax on any gain you make from the April 2015 valuation which is why you need such an estimate. This gain would be taxed at 18% or 28% or a combination of the two rates depending on your UK income including the gain in the year of sale. Companies would be taxed at 20% to mirror UK Corporation Tax rates.
The rules can become complex, but if you have a moment you can read a full explanation here [Source Wragge Lawrence Graham & Co]:
http://www.wragge-law.com/insights/capital-gains-tax-for-non-residents-disposing-of-uk-residential-property-updated-proposals/
I do hope that I have been able to assist you with your question.
Customer: replied 2 years ago.

Thanks for the replay. Now if my property value is less than 2m, much less... we are talking about 600k, do i still need valuation? because if i understand it right the tax on capital gain is applied only to the properties above2m. plus i am not a resident and not uk citizen. please let me know

Expert:  bigduckontax replied 2 years ago.
This is reduced to one million from April 2015. Here is the relevant Wragge extract:
'This is currently £2 million and is due to decrease to £1 million from 6 April 2015 for gains accruing after that date.'
From what you say in your follow up question, at 600K you will escape this impost.
bigduckontax and other Tax Specialists are ready to help you
Expert:  bigduckontax replied 2 years ago.
Thank you for your support.

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