This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies. To find out more about cookies on this website and how to delete cookies, see our Cookie Policy.
Analytics

Tools which collect anonymous data to enable us to see how visitors use our site and how it performs. We use this to improve our products, services and user experience.

Essential

Tools that enable essential services and functionality, including identity verification, service continuity and site security.

Where Taxpayers and Advisers Meet

The 5 year rule - Living Overseas as UK Non Tax Resident

ProfRogers
Posts:1
Joined:Mon Sep 30, 2024 9:20 am
The 5 year rule - Living Overseas as UK Non Tax Resident

Postby ProfRogers » Mon Sep 30, 2024 9:21 am

Hi. Just so I understand the 5 year rule a little better for being a UK Non Tax Resident, I have created this simple example.
(We will presume in this example that I am correctly following the UK sensitive ties rules for spending the appropriate number of days in the UK.

So .... lets say I live 6 years overseas as a non UK tax resident, but I make a £1m Capital Gain EVERY ONE OF THOSE YEARS = £6m.
I then choose to RETURN to the UK on Year 7 as a tax paying resident. In theory would my CGT bill be £0?

wamstax
Posts:2039
Joined:Wed Aug 06, 2008 3:39 pm
Location:Operate Nationally but based in Aberdeen
Contact:

Re: The 5 year rule - Living Overseas as UK Non Tax Resident

Postby wamstax » Tue Oct 29, 2024 11:14 pm

Depends on the nature and situation of the assets purchased and disposed of.
regards and hope this helps
http://www.wamstaxltd.com
Operates Nationally with competitive costs
and email and phone contact (mob 07751720507) can be obtained from websites

AGoodman
Posts:1886
Joined:Fri May 16, 2014 3:47 pm

Re: The 5 year rule - Living Overseas as UK Non Tax Resident

Postby AGoodman » Tue Nov 05, 2024 12:04 pm

I would say that, assuming the disposals are not related to UK land in any way, you would not have a UK CGT liability on your return. The timing of the gain is irrelevant provided you were non-UK resident in the year/split year when you made it.

wamstax
Posts:2039
Joined:Wed Aug 06, 2008 3:39 pm
Location:Operate Nationally but based in Aberdeen
Contact:

Re: The 5 year rule - Living Overseas as UK Non Tax Resident

Postby wamstax » Tue Nov 05, 2024 1:56 pm

While I agree in normal simple cases with Goodman, tax is never so simple and there are numerous exceptions to the rule of thumb that he mentions. Basically I would add that where any gain was related in any way to a period of residence before his departure - e.g. assets held before departure/no gain-no loss spousal transfers/certain trust transactions/offshore companies/ acquisitions on rolled over basis and such complex matters. So if the £1M per annum arose from disposals of assets that were linked to a period of prior residence then UK CGT could apply.
regards and hope this helps
http://www.wamstaxltd.com
Operates Nationally with competitive costs
and email and phone contact (mob 07751720507) can be obtained from websites

wamstax
Posts:2039
Joined:Wed Aug 06, 2008 3:39 pm
Location:Operate Nationally but based in Aberdeen
Contact:

Re: The 5 year rule - Living Overseas as UK Non Tax Resident

Postby wamstax » Tue Nov 05, 2024 1:58 pm

Split years can affect the position for the periods
regards and hope this helps
http://www.wamstaxltd.com
Operates Nationally with competitive costs
and email and phone contact (mob 07751720507) can be obtained from websites


Return to “Capital Gains Tax, CGT”

cron