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HMRC internal manual

Capital Gains Manual

Non-Resident Capital Gains Tax (NRCGT) - Disposals on or after 6 April 2015: The Charge to Non-Resident CGT, and the exemptions: Exemptions from charge

The statute proceeds on the basis of applying a charge across the board, and then allowing exemptions in certain cases.


Exemption has to be claimed, placing the onus on the person to demonstrate that they meet the necessary conditions.


TCGA92/S14F provides that a person is not chargeable to CGT under TCGA92/S14D in respect of a chargeable NRCGT gain if that person is an eligible person and makes a claim for exemption under TCGA92/S14F.


An eligible person is one of the following:

  • a diversely-held company;
  • a unit trust scheme or open-ended investment company which is widely-marketed;
  • a unit trust scheme or open-ended investment company which has an investor which is an offshore fund, an open-ended investment company, or an authorised unit trust, and which has the same manager as the scheme itself (the investor is referred to in the legislation as the “feeder fund”) and the scheme is widely marketed after taking into account the feeder fund;
  • a company carrying on life assurance business, where the UK land being disposed of was held, immediately before the time of the disposal, for the purposes of providing benefits to its policy holders in the course of the company’s business.


An open-ended investment company is a company incorporated in accordance with regulations under the Financial Services and Markets Act 2000, or a company incorporated under the laws of another country and the equivalent of an open-ended investment company (Sch C1/para 9).


A “diversely-held” company is a company that is not “closely held”.  TCGA92/Sch C1/Part 1 sets out the rules for determining whether a company is closely-held (CG73722).  The test for whether a unit trust scheme or open-ended investment company is widely-marketed is set out in TCGA92/Sch C1/Part 2 (CG73726).  These tests are crucial to whether exemption from a charge to CGT may be claimed under TCGA92/S14F and S14G on the disposal of a UK residential property interest.