If you’re a non-resident selling UK property, navigating Capital Gains Tax (CGT) rules can feel like stepping through a minefield. While CGT applies to UK residents on worldwide gains, non-residents are specifically liable for CGT when disposing of UK property or land—even if they live abroad full time.
Understanding when and how to file a NRCGT can help you avoid penalties, manage your tax bill, and stay compliant with HMRC. This guide breaks down what you need to know, what’s changed in recent years, and how to stay on the right side of the law.
When Does CGT Apply to Non-Residents?
As of April 2015, non-residents have been subject to CGT on the sale of UK residential property. This was later expanded in April 2019 to include:
- Commercial property
- Land
- Indirect disposals (e.g., selling shares in a company that holds UK land/property)
In short, whether you’re selling a flat in London or shares in a property-holding company, HMRC wants a slice of the gain.
What’s Considered a ‘Disposal’?
A disposal isn’t just a traditional sale. It could include:
- Gifting a property
- Transferring ownership
- Selling part of your interest (e.g. joint ownership)
Even if you transfer a property to a relative or business partner without receiving money, it still counts as a disposal in HMRC’s eyes.
Reporting Deadline
Here’s where many get caught out. You must report the disposal of UK property within 60 days of completion. This rule came into effect on 27 October 2021, reducing the previous 30-day deadline and applying to both residents and non-residents.
You’re required to report:
- The gain (or loss) from the sale
- Whether tax is due or not
And yes, even if there’s no CGT liability—say, you sold at a loss or the disposal is covered by your annual exemption—you still need to submit a non-resident capital gains tax return to HMRC.
How Much CGT Will You Pay?
For the 2024/25 tax year, CGT rates for non-residents selling residential property are:
- 18% if your total UK income and gains fall within the basic income tax band
- 28% if they exceed the basic rate threshold
For commercial property, the rates are 10% and 20%, depending on your income bracket. You’ll also have a tax-free CGT allowance, currently £3,000 for individuals. Gains above this threshold are taxable.
Keep in mind: only the increase in value since April 2015 (or 2019 for commercial property) is taxable. You can either:
- Rebase the property’s value to April 2015/2019
- Use the time-apportionment method
- Calculate the gain over the whole period of ownership
Choosing the most tax-efficient method may require professional advice.
Temporary Non-Residence? You Might Still Owe Tax
Leaving the UK doesn’t always give you a tax holiday. If you’ve been a UK resident in any part of the four out of seven years before departure—and return within five years—certain gains made while non-resident may still be taxed.
This is known as the temporary non-residence rule, and it’s aimed at people who go abroad, sell assets tax-free, and come back. HMRC wants to prevent that sort of tax planning loophole.
How to File
To report your CGT liability, use HMRC’s online service. You’ll need to:
- Create a Capital Gains Tax on UK Property account
- Submit the necessary details (disposal date, property address, gain/loss, etc.)
- Pay any tax owed
You can pay directly via the portal. If you also complete a Self Assessment tax return, the gain will need to be reported there too—but this does not replace the 60-day return.
