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Where Taxpayers and Advisers Meet

Disposal of assets situated abroad

Charlie
Posts:58
Joined:Wed Aug 06, 2008 2:18 pm

Postby Charlie » Mon Jul 28, 2003 4:16 am

I am shortly moving as a retiree to a country that has a double taxation agreement with the UK. I will become non-resident in the UK and I will comply with the 91 and 183 day rules. I am buying a property in the country to which I am moving whilst retaining a property in the UK. If I were to return to the UK as a resident in (a)less than 3 years or (b)3-5 years or (c)5 years or more, sell my property overseas and remit the proceeds to the UK after paying CGT in the country that I am leaving, would I be liable to UK CGT? If yes, are there any legal ways that I can avoid or reduce UK CGT?

George

Ian McTernan CTA
Posts:1232
Joined:Wed Aug 06, 2008 3:02 pm
Location:Bedford
Contact:

Postby Ian McTernan CTA » Mon Jul 28, 2003 9:11 am

The answer is maybe, dependent on when exactly you sell the overseas property- if in the tax year before you move back, then probably not, if in the tax year in which you move back but before you move back then maybe not, if after you return then CGT applicable. Any foreign tax suffered on the gain should be offsettable against the UK CGT liability and you may be able to claim PPR relief against the gain in the UK (and possibly abroad). Dependent upon which country you are going to and the terms of the specific DTA, you may only be liable to tax in one country and not the other (taxing rights vary in DTAs).

You also need to consider the position on your UK property as you may start to build up a CGT liability on this the longer you are out the country as it will no longer be your PPR.

Ian McTernan CTA
McTernan Associates Ltd
Chartered Tax Advisers
ian@imcternan.com
McTernan Associates Ltd
Chartered Tax Advisers
Bedford
Email through link on website:
http://www.imcternan.com

Charlie
Posts:58
Joined:Wed Aug 06, 2008 2:18 pm

Postby Charlie » Mon Jul 28, 2003 9:38 am

Thank you, Ian. Most helpful. I will contact you further about this nearer the time.


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