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HMRC internal manual

Capital Gains Manual

Non-Resident Capital Gains Tax (NRCGT) – Disposals on or after 6 April 2015: Interaction between Non-Resident CGT and ATED-related CGT: Post April 2016 disposals computations, example

This example follows on from example 3 at CG73628 in the ATED-related CGT guidance. It shows how to calculate the NRCGT gain or loss on that disposal after calculating the ATED-related gain or loss.

 

Basic information:

Residential property acquired April 2010 for £300,000 and disposed of 7 April 2018 for £700,000.

The property had a value of £500,000 at 5 April 2015 and £550,000 at 5 April 2016.

Estimated Indexation factors are:

April 2015 to April 2016        0.013

April 2016 to April 2018        0.019

 

Total number of days chargeable to ATED (assumed)           200

Total days 6 April 2016 to day preceding disposal                730

 

Step 1

 

Determine the amount equal to the special fraction of the notional post-April 2016 gain or loss

 

Disposal proceeds                   £700,000

Market value at 5 April 2016  £550,000

Indexation allowance              £10,450

Post-April 2016 gain               £139,550

 

SD = 530

TD = 730

 

SD/TD x Post-April 2016 gain = £101,317

 

Step 2

 

Determine the amount equal to the special fraction of the notional pre-April 2016 gain or loss

 

Asset was held at 5 April 2015 so the pre-April 2016 gain or loss is the gain or loss which accrued between 5 April 2015 and 5 April 2016.

 

Market value at 5 April 2016  £550,000

Market value at 5 April 2015  £500,000

Indexation allowance              £6,500

Pre-April 2016 gain                 £43,500

 

SD = 365

TD = 365

 

SD/TD x gain = £43,500

 

Step 3

 

Add Step 1 to Step 2

 

Step 1              £101,317

Step 2              £43,500

 

NRCGT gain £144,817

 

See CG73894 for how to calculate the gain or loss that is neither ATED-related nor an NRCGT gain or loss.