How long have you been living in Spain? Will you be selling your UK house before or after your return to the UK? How much did the UK house cost to buy? When exactly did you buy it (month and year)? Did you move in as soon as you bought it? When exactly did you move out (month and year)? Was the property let right away and has it been let or available for let ever since? Is the UK property jointly owned and has it always been so?
Leave this with me while I draft my answer.
Do you want me to finish my answer before a call? There is quite alot to it as the rules have changed for non-UK residents.
I'm typing my answer now. You will get an email when I have posted it.
If you sell the UK property after you return to the UK, say in November 2016, the UK CGT position for each of you individually will be as follows:
Total period of ownership to November 2016: 164 months
Period of owner occupation: 14 months
Period of letting: 150 months
Gain: £51,500 (£240,000 - £137,000 / 2) This can be reduced further by deducting legal fees (purchase and sale), survey fees, stamp duty, selling agent fees etc)
Exempt gain: £10,049 (£51,500 / 164 x 32 (14 months of occupation + last 18 months of ownership)
Letting period gain: £41,451 (£51,500 / 164 x 132 (150 - last 18 months of ownership)
Gross Non-Exempt Gain: £41,451
Letting Relief: £10,049 (lesser of £40,000, £10,049 and £41,451)
Annual CGT Exemption: £11,100
Net Taxable Gain: £20,302
CGT @ 18% or 28% or a combination of the two rates depending on the level of your income in 2016/17. Look here to see how to calculate your CGT rate.
Non-UK resident individuals became liable to CGT in the UK on gains made on the sale of UK residential property with effect from 6 April 2015. However, if it is beneficial to you, you can use the 5 April 2015 value of the property as your cost which will obviously be higher than the original purchase price of £137,000, so long as you sell the property before you resume living in the UK. Take a look at the notes here and here for more information. The potential downside to a sale before you return to the UK is that you may have to pay CGT in Spain. You would need to seek local advice on that as I'm not an expert on the Spanish tax system.
I hope this helps but let me know if you have any further questions.
The net taxable gain is £20,302 each. As I said in the opening to my answer " the UK CGT position for each of you individually will be as follows:".
The CGT cannot be more than 28%, ie £5,684.56 each. Some of your respective net taxable gains will be taxable at 18% but how much will depend on when you return to the UK and how much your respective incomes are between the date you return to the UK and 5 April 2017, assuming you sell the property in the current tax year.
I haven't tried to do anything. I'm an independent contractor and simply answer tax questions. Contact customer services at just answer to resolve your problem.