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TaxRobin
TaxRobin, Tax Consultant
Category: Tax
Satisfied Customers: 15739
Experience:  International tax
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1. I am a UK national 2. I left the UK in September 2013 to

Resolved Question:

1. I am a UK national
2. I left the UK in September 2013 to live abroad permanently
3. I purchased an investment property in Jan 2014 in the UK to rent out
4. I sold the property in June 2016 and made a capital gain
5. I will return to the Uk to live in September 2016
6. I realise I must pay capital gains tax on the % gain from 5 April 2015 (I plan to use the straight line method for this calculation)
Question...
Am I caught under the "temporary non-residence" rules and therefore have to pay tax on the FULL capital gain (not just on the gain from 5 April 2015)
Thanks
Submitted: 1 year ago.
Category: Tax
Expert:  TaxRobin replied 1 year ago.

Hello and thank you for allowing me to assist you.

Expert:  TaxRobin replied 1 year ago.

These rules (called ‘temporary non-residence’) apply if both:

  • you return to the UK within 5 years of moving abroad (or 5 full tax years if you left the UK before 6 April 2013)
  • you were a UK resident in at least 4 of the 7 tax years before you moved abroad

From what you have posted you are under ‘temporary non-residence’ if you come back in 2016.

You don’t have to pay Capital Gains Tax if all your gains in a year are under your tax-free allowance. If not then yes, the gain is taxable in the UK based on your not being absent for the needed time unfortunately.

Customer: replied 1 year ago.
ok
So to be clear....
1. My total capital gain is more than my tax-free-allowance and I will be in the 28% higher income bracket
2. so, I Cannot only pay on gains post 5-April-2015 but on the TOTAL capital gain earned, less expense, times 28%
There is no reduction by removing the capital gain made pre 5-April-2015Correct ?
Expert:  TaxRobin replied 1 year ago.

That is correct

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