CG25000 - Individuals: effects of residence, ordinary residence and domicile
Introduction
Broadly, the legislation aims to charge Capital Gains Tax on gains where there is an appropriate connection between an individual realising a gain and the UK. The connection may be one of the following types.
- The individual may be resident in the UK
- The individual would have been chargeable to CGT under TCGA1992/S10* (non-UK resident trading through a branch or agency) see CG25515
- TCGA1992/S10A* (temporary non-residence periods) applies see CG26500 onwards.
- Gains attributed under TCGA92/S86 that arise in a year are treated as falling within the UK part of a split year. See CG38400 onwards.
- From 6 April 2015 where the disposal is of an interest in UK residential property see CG73700 onwards.
- From 6 April 2019 where it is a direct or indirect disposal of an interest in UK real property see CG73920 onwards.
This general scheme is affected in some circumstances by the domicile of the individual and the effects of double taxation treaties.
* These provisions were re-written for disposals from 6 April 2019 see CG10150.
Layout of guidance
The following paragraphs tell you more about the implications of residence, ordinary residence* and domicile status for the liability to CGT of individuals.
- Residence and ordinary residence*, see CG25200 - CG25203.
- Temporary residence, see CG25100 - CG25101.
- Arrival in and departure from the UK, see CG25700+.
- Domicile and the remittance basis, see CG25300 - CG25440.
If an individual who is neither resident nor ordinarily resident* in the United Kingdom carries on a trade, profession or vocation in the UK through a branch or agency, he or she may be liable to Capital Gains Tax on disposals of assets used in that activity: see CG25500 - 25621.
If an individual who is resident or ordinarily resident* in the United Kingdom is a direct or indirect participator in a non-UK resident company, he or she may be chargeable to Capital Gains Tax in respect of gains which accrue to the company: see CG57200+.
*Ordinary residence only needs to be considered for the years up to and including 2012/13.
Subjects
For information about assessing resident or ordinarily resident* individuals on the gains arising to non resident companies in which the individual is a direct or indirect shareholder, or a direct or indirect participator where gains accrue on or after 28 November 1995, see CG57200+.
*For 2013/14 and subsequent years ordinary residence does not need to be considered.
Meaning of terms
The terms resident and ordinarily resident are defined as having the same meaning as in the Income Tax Acts.
The terms domicile and deemed domicile (from 6 April 2017) should also be interpreted on the same basis as applies for Income Tax. References in the legislation to a person being domiciled in the UK should be taken to include a person who is domiciled in any of England, Wales, Scotland or Northern Ireland. The United Kingdom does not include the Isle of Man or the Channel Islands.
Guidance on the meaning of those terms can be found in RFIG for Residence and RDRM for Domicile manuals.
A Statutory Residence Test for individuals was introduced for years from 6/4/2013. For 2013/14 and later years ordinary residence does not need to be considered.
Guidance on the Statutory Residence Test can be found in the RDR3 Guidance Note: Statutory Residence Test (SRT).