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HMRC internal manual

Trusts, Settlements and Estates Manual

Non-resident trusts: trustees’ chargeability: Capital Gains Tax - exit charge

If a UK resident trust becomes non-resident in a tax year, then immediately before the trust became non-resident there is deemed to be a disposal and reacquisition of the trust assets at the market value at that time (TCGA/S80).

If the disposal gives rise to a capital gain then the trustees are chargeable to Capital Gains Tax on that gain for the year, unless the settlor is in fact chargeable on those gains for years up to and including 2007-08 in accordance with TCGA/S77. Where Capital Gains Tax is payable, then this is commonly referred to as an ‘exit charge’. HMRC Trusts & Estates Non Resident Trusts deal with any liability under TCGA/S80 (CG38200). External

Further information about the exit charge is at CG38215. External