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HMRC internal manual

Capital Gains Manual

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HM Revenue & Customs
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Arrival in and departure from UK: temporary non-residence: ESCD2 example (1) - year of departure 2012-13 or earlier

Mr Fielding, who has lived all his life in the UK, leaves the UK on 5 August 2009 for a three year contract of employment abroad.

He resumes tax residence in the UK on 2 September 2012.

He realises a chargeable gain (on an asset acquired before he left the UK) of £15,000 on 20 April 2012.

Mr Fielding does not meet the conditions for TCGA92/S10A to apply because the gain accrued in the year of his return to the UK and not during a year for the whole of which he was non-resident. You must consider whether extra-statutory concession D2 applies:

  • A gain accrues in a tax year (2012-13) in part of which he is resident in the UK. TCGA92/S2 will normally apply to charge that gain even if it accrued at a time when he was not so resident.
  • Mr Fielding was resident in the UK at a time during the five tax years immediately preceding 2012-13. (Those years are 2007-08 to 2011-12 inclusive; Mr Fielding was resident in the UK during and before 2009-10.).

The conditions in the first paragraph of ESC D2 are not met and so TCGA92/S2 applies without limitation. The gain of £15,000 is charged to tax in year of assessment 2012-13.