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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 (2) - year of departure 2012-13 or earlier

Dr Burney, 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 August 2009.

Dr Burney does not meet the conditions for TCGA92/S10A to apply because the gain accrued in the year of his departure from 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 ( 2009-10) 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.

Dr Burney was resident in the UK for all of the seven tax years immediately preceding the year of departure. (Those years are 2002-03 to 2008-09 inclusive.)

The conditions in the second 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 2009-10.

Notice that in this case the date of his return to the UK, or even whether he returns at all, is not significant.