CG73769 - Non-Resident Capital Gains Tax (NRCGT) – Disposals on or after 6 April 2015 to 5 April 2019: Individuals: Special rules, and computation: Existing CGT provisions for individuals chargeable to Non-resident CGT: Deemed disposals on exiting the UK

Deemed disposal of UK residential property interest under section 25(3)

Where a person has ceased to trade through a UK branch or agency, they are deemed (under TCGA92/S25) to have made a disposal of an asset (see CG25530). A new provision TCGA92/S25ZA applies in this case. Where the asset in question is a UK residential property interest, and a non-resident CGT charge or loss would accrue to the person on the deemed disposal, the gain or loss will not accrue at the time of the deemed disposal, but when all or part of the interest in question is subsequently disposed of - at which point it will be treated as a non-resident CGT chargeable gain or allowable loss.

The person may elect for TCGA92/S25(3) not to have effect if that is advantageous to them.

Deemed disposal of UK residential property interest under section 80

Where the trustees of a settlement have ceased to be UK resident, they may be deemed (under TCGA92/S80) to have made a disposal of a UK residential property interest. Under new provision TCGA92/S80A they may elect for the non-resident CGT gain or loss on the deemed disposal to accrue not at the time they leave the UK, but when all or part of the interest in question is subsequently disposed of. In that case the gain or loss on the deemed disposal would accrue at the time of the later disposal.

Emigration of donee, deemed disposal of UK residential property interest under S168

TCGA92/S168 provides that where an individual emigrates from the UK, with a gain on an asset they had acquired held over under TCGA92/S165 or 260, the gain accrues when they cease to be UK resident (see CG25780).

The new legislation introduces TCGA92/S168A, which modifies the effect of TCGA92/S168 in cases where the asset in question is a UK residential property interest and a non-resident CGT gain would be deemed to accrue under TCGA92/S168 at the time the individual ceases to be UK resident.

The individual may elect that the held over non-resident CGT gain or loss on the deemed disposal should not accrue at the time they cease to be UK resident. Where they prefer this course, the non-resident CGT gain (or loss) on the deemed disposal would accrue when the interest in question is subsequently disposed of.