Guidance: Tell HMRC about Capital Gains Tax on UK property or land if you’re not a UK resident

Overview

From 6 April 2020 you need to report and pay your non-resident Capital Gains Tax using the Capital Gains Tax on UK property account if you’ve sold or disposed of:

• residential UK property or land (land for these purposes also includes any buildings on the land)
• non-residential UK property or land
• mixed use UK property or land
• rights to assets that derive at least 75% of their value from UK land (indirect disposals)

A ‘mixed use’ property is one that has both residential and non-residential elements. For example, a flat connected to a shop, doctor’s surgery or office.

You must report and pay non-resident Capital Gains Tax if you’re a:

• non-UK resident individual 
• personal representative of a non-UK resident who has died 
• non-UK resident who’s in a partnership 
• non-UK resident landlord 
• non-UK resident trustee 
• UK resident meeting split year conditions and the disposal is made in the overseas part of the tax year

You must report the disposal online the even if:

• you’ve no tax to pay
• you’ve made a loss
• you’re registered for Self Assessment

If a property was jointly owned, each owner must tell HMRC about their own gain or loss. Special rules apply if you give a UK property to your spouse, your civil partner, or to charity.

You must report and pay any non-resident Capital Gains Tax due within:

• 60 days of selling the UK property or land if the completion date was on or after 27 October 2021
• 30 days of selling the UK property or land if the completion date was between 6 April 2020 and 26 October 2021

You need to submit a non-resident Capital Gains Tax return if you’ve sold or disposed of UK property or land up to 5 April 2020.

Non-resident companies

From 6 April 2019, Corporation Tax rather than Capital Gains Tax will be charged on gains from UK property or land for all non-resident companies.

If you do not already submit a Corporation Tax return, you must register a non-resident company for Corporation Tax.

Deadline for reporting the disposal and payment

From 27 October 2021, you must report and pay within 60 days of completion of conveyance.

For example, if you complete the disposal on 1 November you must report and pay your Capital Gains Tax by 31 December.

If the completion date was between 6 April 2020 and 26 October 2021 you must report and pay within 30 days of completion of conveyance.

You may have to pay interest and a penalty if you do not report and pay on time.

Work out what you need to pay

You’ll need to work out what you need to pay if you’ve sold or disposed of either:

• a UK residential property since 6 April 2015
• a UK non-residential property or land from 6 April 2019
• an indirect disposal of UK land from 6 April 2019

You can use the non-resident Capital Gains Tax calculator if you’re a non-UK resident individual who’s sold or given away your entire share of a UK residential property. The calculator will take you about 10 minutes to use.

Do not use the calculator if:

• you used all or part of the property to conduct business
• your property, garden and grounds take up more than 0.5 hectares
• you’re an agent, trustee or personal representative
• you’ve sold or given away a part share of your UK residential property
• you’ve sold or given away UK non-residential property or land
• you’ve made an indirect disposal of UK land

How to report disposals

For properties that are disposed of from 6 April 2020 you must report and pay using the Capital Gains Tax on UK property account. You will be able to report multiple disposals with the same completion date on one return.

When you report a disposal, you need to include a computation of your gains and losses along with your return.

Trustees of non-UK resident trusts

Trustees of non-UK resident trusts that become liable to pay non-resident Capital Gains Tax, must be registered with HMRC before creating a Capital Gains Tax on UK property account. Find out more about when and how to register a trust.

If you’re a trustee of a non-UK resident trust, you must report the disposal of UK property or land, even if you have no tax to pay. If you have no tax to pay, contact the Capital Gains Tax helpline to request a Capital Gains Tax on UK property paper return to report the disposal.

If you need to amend your Capital Gains Tax return

You can amend details of a disposal by using your Capital Gains Tax on UK property account.

Penalties

You have 60 days from the date of conveyance to report your disposal and pay any tax due. You’ll get a late filing penalty and be charged interest if you do not do this by the 60-day deadline.

If you miss the deadline by:

• up to 6 months, you will get a penalty of £100
• more than 6 months, a further penalty of £300 or 5% of any tax due, whichever is greater
• more than 12 months, a further penalty of £300 or 5% of any tax due, whichever is greater

If you have to pay any non-resident Capital Gains Tax within the same 60-day period, late payment penalties and interest may also be due if you miss the deadline.

If any non-resident Capital Gains Tax remains unpaid after 31 January after the end of the tax year of the disposal, a late payment penalty of 5% of the tax outstanding will be charged.

Use an agent

If you would like an agent to report the sale or disposal of UK property or land to HMRC on your behalf, you must first set up a Capital Gains Tax on UK property account.

You will need to provide the agent you would like to manage your account with your Capital Gains Tax on UK property account number and country of residence.

Your agent will send you a link by email to request access to your Capital Gains Tax on UK property account.

If you accept the authorisation request, the agent will be able to report and manage the account and returns on your behalf.

Self Assessment tax returns

If you need to complete a Self Assessment tax return you must still fill in the Capital Gains section of your tax return for the year of the disposal, unless the gain is exempt due to Private Residence Relief.

Direct disposals of UK property or land

You must tell HMRC and may have to pay Capital Gains Tax when you sell or dispose of an interest in UK property or land.

There are different rates of Capital Gains Tax to pay depending on whether the direct disposal is for residential or non-residential UK property or land.

Residential property is defined as:

• a building used or suitable for use as a dwelling
• properties in the process of being constructed or adapted for use as a dwelling
• the garden or grounds of such a building, including structures on the garden or grounds
• the right to acquire a UK dwelling ‘off plan’

Non-residential property or land includes:

• commercial property, for example shops or offices
• agricultural land
• forests
• any other land or property which is not used as a residence

A ‘mixed use’ property is one that has both residential and non-residential elements. For example, a flat connected to a shop, doctor’s surgery or office.

Indirect disposals of UK property or land

You must tell HMRC and may have to pay Capital Gains Tax when you make an indirect disposal of UK land.

Land for these purposes also includes any buildings on the land.

When an indirect disposal occurs

An indirect disposal occurs when a non-resident sells shares in a company that derives 75% or more of its gross asset value from UK land, and the person making the disposal has an investment of at least 25% in that company which holds UK land as an investment.

The gains on indirect disposals will be calculated using the value of the asset being disposed of, rather than the value of the underlying UK land.

Indirect disposals do not apply when:

• land used in a continuing trade is also disposed of
• 2 or more companies are sold at the same time by the same investors and the property richness test would not apply if the disposals were taken as one transaction — read more information about property richness

Temporary non-residents

Different rules apply if you’re temporarily non-resident and make disposals during a tax year when you were either:

• not resident in the UK
• overseas as part of a split year

If you meet the temporary non-resident rules then the portion of gain not charged to non-resident Capital Gains Tax will come within the scope of UK Capital Gains Tax for the year, or period of return to the UK.

If you do not meet the temporary non-resident rules, there will not be an additional UK Capital Gains Tax charge for the earlier disposal when you return to the UK.

Individuals (including trustees and executors, or personal representatives of a deceased person) are entitled to the Capital Gains Tax Annual Exempt Amount (AEA). You can only use the AEA once in a tax year, even if it was a split year.

Personal representatives of a deceased person who lived abroad

If you’re the personal representative of a deceased person who lived abroad, you’ll need to report the disposal to HMRC.

The AEA is available for disposals in the same tax year as the death or the following 2 tax years.

Keep records of what you report to HMRC

You need to keep records to support the gains or losses you report to HMRC.

If your calculation uses a market value, for example, if you owned the whole or part of an interest in a UK property or land, it’s your responsibility to accurately value the property or land.

Depending on the property or land concerned, you may want to use a professional valuer or get more than one valuation.

Disposals made before 6 April 2020

For properties that are disposed of up to 5 April 2020 you must complete a separate online non-resident Capital Gains Tax return for each disposal, and any amendments you make.

When you report a disposal, you need to include a computation of your gains and losses along with your return   If you choose to defer payment for a property sold up to 5 April 2020, the computation should be included with your relevant Self Assessment return and payment made as part of your normal end of year payment.

Use a tax agent or adviser

To give HMRC limited authorisation to deal directly with your agent or adviser, email: non-residentcgt.spt@hmrc.gov.uk

Limited authorisation means this authorisation only applies to matters concerning non-residents Capital Gains Tax up to 5 April 2020 and not to the Capital Gains Tax on UK property account.

You do not need limited authorisation if you already have appropriate authorisation in place for someone to deal with HMRC on your behalf about your Income Tax.