From 6th April 2015 we see the introduction of new Capital Gains Tax Rules for Non-Resident UK Property Owners.
Although it has been public knowledge for a while, in just over two weeks' time the Government is introducing new rules whereby non-resident property owners will have to pay Capital Gains Tax when they sell their property in the UK. All Capital Gains will be payable from 6th April 2015 onwards on gains arising after the rebasing date of 5th April 2015.
The Government advises non-resident property owners to record the condition and value of their property as at 5th April 2015. Therefore it would be prudent to commission a professional valuation to make a formal and reasoned record of the value on this date. Going forward, it will carry greater weight in ten or twenty years' time if it is contemporaneous.
Our consultant, Graham Marks FRICS, a Chartered Valuation Surveyor, specialises in this field and has many years of experience in carrying out valuations for tax purposes, which gives our opinion greater weight when dealing with the District Valuer.
The Government's guidance states that the rate of Capital Gains Tax for non-resident property owners will be the same as for nationals: 18% or 28% for individuals, 28% for trusts, and the annual exempt amount will be the same. The tax rate for individuals depends on the amount of taxable UK income the person has.
Some of our clients own property in special vehicles and we have been carrying out valuations for these clients to transfer the property into a UK resident's name. Provided there is no debt on a property, the transfer, if it is a gift, will be exempt from Stamp Duty Land Tax (SDLT).
When property is sold in the UK the vendor has to report the disposal on a NRCGT return and pay any Capital Gains Tax due within 30 days of the day after the date the property sale is completed, or if they are already enrolled in the UK's Self-Assessment they pay this as part of the normal end of year tax payment.
As tax is a legal charge and this is a very complex area, it is essential that advice is taken from a qualified solicitor as well.
If you have further enquiries, please contact Graham Marks FRICS, on 020 7581 4103 or visit us here at our offices, 4 Yeoman’s Row, SW3 2AH