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

Buying a Flat from a non-resident

priyaplonka
Posts: 3
Joined: Mon Oct 07, 2019 2:12 pm

Buying a Flat from a non-resident

Postby priyaplonka » Mon Oct 07, 2019 10:17 pm

Hi, i'm posting this again in the 'international section' (sorry if this is frowned upon)

I am looking to buy my dads flat. He used to live here in the UK but moved to India for retirement in 2010. He is definitively a non-resident as he only visits for a week or two every year.

He is fine with me buying the flat but asked me if I am allowed to pay him for the flat in India, from my Indian bank account. Is that allowed?

Thank you, Priya

AGoodman
Posts: 881
Joined: Fri May 16, 2014 3:47 pm

Re: Buying a Flat from a non-resident

Postby AGoodman » Tue Oct 08, 2019 9:50 am

Sure. Unless there is something you're not telling us that's absolutely fine.

You still have to pay SDLT and he has to file a NRCGT return and potentially (but not necessarily) pay some CGT for any growth in value since 2015. He has to file the return within 30 days of completion.

As you are family, any gain will be calculated on open market values (i.e. April 2015 vs now) rather than the actual price you pay. SDLT based on sum actually paid.

priyaplonka
Posts: 3
Joined: Mon Oct 07, 2019 2:12 pm

Re: Buying a Flat from a non-resident

Postby priyaplonka » Tue Oct 08, 2019 10:51 am

Thanks, that's really cool. I don't think I am missing anything or withholding any information. This will save a fortune on exchange rate fees. It will all be done through official banking channels so lots of proof. We expected to have to pay the taxes here anyway.

I just thought it sounded weird and would not sit right with the taxman. The only thing i can think that might seem dodgy is that my money in India was originally given to me by my mum and dad over the last few years as 'early inheritance' so to speak (I have declared it here). He would have given me his flat but was afraid of paying both CGT and IHT.

I presume any difference between sum paid and valuation for CGT would basically be liable for IHT?

Priya

AGoodman
Posts: 881
Joined: Fri May 16, 2014 3:47 pm

Re: Buying a Flat from a non-resident

Postby AGoodman » Tue Oct 08, 2019 1:30 pm

"I presume any difference between sum paid and valuation for CGT would basically be liable for IHT?"

Potentially, any underpayment would be a gift. It would only be subject to IHT if your father died within 7 years and the total chargeable gifts/estate were greater than the nil rate band. If your father is/became domiciled in India then only UK assets/gifts would be relevant


Return to “International Tax”

cron