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bigduckontax, Accountant
Category: Tax
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10 years ago I bought a commercial property in Canada, for

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10 years ago I bought a commercial property in Canada, for $143,000 in advance of us emmigrating, which we never did due a change of circumstances. British born, we remained UK residents. The money to purchase this property was sent from the UK, a remortgage of our UK property, which was then our own only residence.
Though we were able rent out the property out for a few years, we took no profit from the building, all proceeds went in Canadian Taxes, maintenance, refurbishment, other bills etc
This year after, years of trying, we have sold the property for less than we paid. Once Canadian Tax is paid and after all outgoings, we should be left with approx $125,000.
We would like to bring this money back to the UK. What must we do in terms of HMRC? Could we be liable to Tax? How should we transfer the funds?
Hello, I'm Keith and happy to help you with your question.

Absolutely nothing, well not quite! You are liable to UK Capital Gains Tax (CGT) on the sale of your second house in Canada, but as you did not make a gain there is no tax to pay.

You should report this capital loss to your tax office if you do not regularly self assess. If you do self assess then enter the loss on the form. You have 4 years in which to claim this loss.

The loss is allowable against any capital gain you have made in the year of the loss eg from trading stocks and shares. Otherwise it is carried forward to future years and is available to offset capital gains made in the future. Remember you have an Annual Exempt Allowance (AEA) of 11K this year so don't fritter your capital loss by offsetting gains below the AEA.
Customer: replied 3 years ago.
Many thanks. How do I report this to HMRC and to whom, as I do not self assess?

By letter to your tax office. If you do not have one of those then to:


HM Revenue & Customs

Capital Gains Tax

PO Box 1970


L75 1WX


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