GGT and Entrepreneurs Relief if Non UK Resident

by **ros** on Mon Mar 15, 2010 11:54 am

I left the UK some years ago and am not resident for tax in the UK. I file a UK tax return just for rental income on a buy to let property. I am the owner/director of a UK based company. The business does not have any Permanent Establishment outside the UK and pays UK Corporation Tax. I have no plans to return to the UK at any time in the future.
If I sell my UK company, what UK taxes would I pay? Would I have to pay UK CGT? Would I get Entrepreneurs Relief? Or would I pay no UK taxes and only any CGT that may apply in my country of residence? My country of residence has a Double Taxation Treaty with the UK.

by **mullet** on Mon Mar 15, 2010 6:36 pm

If you (as an individual, your company doesn't matter here) are not resident or ordinarily resident in the UK, then you are not liable to UK capital gains tax. Two things to watch out for - the anti-avoidance rules at Section 10A TCGA 1992 and the Robert Gaines-Cooper case. If you have been NR for more than 5 full tax years then you have nothing to worry about there. But the R G-C case ... who knows what the fallout from that will be?

by **ros** on Mon Mar 15, 2010 8:32 pm

Thanks MSP!

Looking at the anti-avoidance and the case you refer I can safely say neither would apply to me. I rarely visit the UK, and my centre of life is definately not in the UK and I have no plans to return to the UK.

Tax consultants in my country of residence say that there is no CGT. So even though my company is a UK based business, and my buy to let property is in the UK, the sale of either would not attract CGT in the UK?

by **mullet** on Mon Mar 15, 2010 9:54 pm

Tax consultants in my country of residence say that there is no CGT. So even though my company is a UK based business, and my buy to let property is in the UK, the sale of either would not attract CGT in the UK?

For you as an individual, yes it looks that way. But that relates only to your ownership of the BTL property and the shares in the company. Remember that you and the company are separate legal persons. So the company could be liable to corporation tax (not CGT) on any gains that it makes.