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Old 30.11.2015, 09:17
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CGT on foreign property

We live in Switzerland and have just sold a property in the UK. Is there capital gains tax to be paid in Switzerland?
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Old 30.11.2015, 12:17
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Re: CGT on foreign property

This depends:

- Was CGT paid in the UK? or was this you sole residence sold to move here?
- Have you previously shown the property on your Swiss tax form? If so does it actually show a gain on sale??

My experience is that the Swiss local tax office and the Notariat (legal department when buying/selling a property) work very closely on sales here. However, your Swiss tax office will only be informed by you of a sale in the UK.

Obviously if you shift the capital over here, the Swiss tax man will need to know from whence this came. You should be declaring your world-wide assets.

I certainly did not declare any gain, nor was I asked, I just declared the value...
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Old 30.11.2015, 18:41
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Re: CGT on foreign property

I'm pretty sure Swiss CGT (for fixed property) applies only to property that is located within Switzerland. Your 'wealth' (for wealth tax) may be affected, as you probably had previously declared it below market value as part of your wealth (perfectly correctly), but now would have the cash at full market value as part of your wealth.
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Old 30.11.2015, 19:37
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Re: CGT on foreign property

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We live in Switzerland and have just sold a property in the UK. Is there capital gains tax to be paid in Switzerland?
No, only non moveable assets in CH are liable to CGT.

If it was an investment property & you return to the UK within 5 years of leaving, you will have CGT to pay in the UK on your return. You may also be liable to any gain since the 6/4/2015
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Old 30.11.2015, 22:48
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Re: CGT on foreign property

Best thing to do with UK property is make sure it is your PPR before you leave, let it out while you are gone, and make sure it is your PPR when you return.

That way you maximise your PPR relief which used to be up to 100% even with 7 years absence, now reduced to 5.5 years. On top of that you have the private lettings relief which can wipe out up to another £40k of gains.

All in all, the tax rules for UK property are pretty generous and with the right planning you should be able to pay little or no tax.
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Old 05.11.2020, 15:44
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Where is this documented that only 5.5 years is allowable? It was always my understanding that if you move for work then ppr is available if you return in full

4.6b from the following shows there is no time limit if you move abroad

https://www.gov.uk/government/public...relief-2017--2

Fatman. Can you explain the five year rule for cgt if non tax resident. Is that five years clear from date of sale or five years in total??

What I mean is if you have a btl which has a big cgt can you sell it after five years non resident and then immediately return to Uk without paying any cgt tax or do you have to sell it today and then wait five clear years before returning?

Last edited by roegner; 05.11.2020 at 16:18. Reason: Merging consecutive posts
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Old 05.11.2020, 16:23
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Re: CGT on foreign property

CGT rules have changed relatively recently and are likely to continue to do so. All the info is available online. If you have a purely buy-to-let property then I doubt there will be any UK CGT relief. Look it up and find the answers.
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Old 05.11.2020, 17:00
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Re: CGT on foreign property

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Where is this documented that only 5.5 years is allowable? It was always my understanding that if you move for work then ppr is available if you return in full

4.6b from the following shows there is no time limit if you move abroad

https://www.gov.uk/government/public...relief-2017--2

Fatman. Can you explain the five year rule for cgt if non tax resident. Is that five years clear from date of sale or five years in total??

What I mean is if you have a btl which has a big cgt can you sell it after five years non resident and then immediately return to Uk without paying any cgt tax or do you have to sell it today and then wait five clear years before returning?
On an investment property assuming you remain non resident for 5 FULL UK tax years you would pay UK CGT on any uplift in value since 5 April 2015. If you return to the UK before 5 years you will pay uplift from purchase / 1982 value if earlier plus refurbishment costs & sale purchase expenses
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Old 05.11.2020, 17:22
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Re: CGT on foreign property

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On an investment property assuming you remain non resident for 5 FULL UK tax years you would pay UK CGT on any uplift in value since 5 April 2015. If you return to the UK before 5 years you will pay uplift from purchase / 1982 value if earlier plus refurbishment costs & sale purchase expenses
This is correct and I have read this and can confirm it

What remains outstanding is how the five years should be interpreted. I see two meanings:

1) Sell uk btl today and wait five years before returning
2) wait five years and then sell before catching the first flight home

clearly these two are are on either side of the spectrum but do you actually know which one is correct??

can you really wait five years then sell then move back to the UK?
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Old 05.11.2020, 17:46
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Re: CGT on foreign property

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This is correct and I have read this and can confirm it

What remains outstanding is how the five years should be interpreted. I see two meanings:

1) Sell uk btl today and wait five years before returning
2) wait five years and then sell before catching the first flight home

clearly these two are are on either side of the spectrum but do you actually know which one is correct??

can you really wait five years then sell then move back to the UK?
this was done to defeat planning. i know one case where huge gains were made tax free as the guy was sent on a nice year long trip around the world designed to make the gain non-taxable in any jursidiction. a 1 year trip is ok. but 5 takes a bit more effort.

https://www.litrg.org.uk/tax-guides/...ital-gains-tax

Very broadly, you will be temporarily non-resident in the UK if:

you have been resident in the UK for at least four tax years (out of the seven tax years prior to departure); and
you leave the UK and become non-resident; and
you then return to the UK after a period of non-residence lasting five years or less.
If there is any doubt over whether or not you have a period of non-residence lasting five years or less, please defer to the detailed rules contained within HMRC’s technical manuals. Depending on your circumstances, this can be counter-intuitive and may not reflect the period you were physically outside the UK.
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Old 05.11.2020, 20:29
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Re: CGT on foreign property

Thanks very useful information.

However it still does not explain whether you have to wait five clear years after sale or not.
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Old 29.12.2020, 22:30
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Re: CGT on foreign property

Out of interest, what is the best option to get the value of the property as of 6th April 2015 for CGT purpose in case of sale of the property in UK?
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Old 30.12.2020, 07:50
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Re: CGT on foreign property

CGT on a UK property is only paid to HMRC. The Swiss disregard foreign real estate for tax purposes as it is taxed in the country where the asset is located.

It can however affect the calculation for wealth tax purposes.
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Old 30.12.2020, 08:18
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Re: CGT on foreign property

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Out of interest, what is the best option to get the value of the property as of 6th April 2015 for CGT purpose in case of sale of the property in UK?
You need to pay a valuer, this is important if HMRC decide they disagree 10 years down the road as the valuer has to justify his valuation.

There is a fairly good chance that CGT rates will get aligned with income tax rates, so liability could be far higher than today.
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Old 30.12.2020, 11:36
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Re: CGT on foreign property

When you day five FULL tax years what exactly do you mean ?

Suppose you come to Switzerland on a permit in June 2020 and your b permit expires June 2025. That is five full years but only three full Uk tax years. Therefore are you saying that in fact you need to leave June 2027 as the first and last year are split tax years?
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Old 30.12.2020, 11:41
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Re: CGT on foreign property

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When you day five FULL tax years what exactly do you mean ?

Suppose you come to Switzerland on a permit in June 2020 and your b permit expires June 2025. That is five full years but only three full Uk tax years. Therefore are you saying that in fact you need to leave June 2027 as the first and last year are split tax years?
This is for stock exchange gains, not UK BTL property. Unless you are away for 5 UK tax years so June 20 to 6th April 2026. 5th April 21 to 6th April 26 being 5 UK tax years.

CGT payable on UK property gains since 6 April 2015, the tax has be be paid very quickly.
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Old 30.12.2020, 13:22
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Re: CGT on foreign property

Thank you Farman. As usual a fountain of wisdom

Just two short questions if I may

1) are you sure about your example of June 2020 meaning the earliest to leave is 6 April 2026? I have to say that I have not seen any guidance on this from hmrc website and I thought it was five years departure but you seem to have interpreted that as five years not including split tax years. Do you have any links to support that because that could mean a further year of residence required

I mean suppose someone came 6 April then that could make a difference then if they came on 4 April as an extreme example

2) if what you say is correct and your permit expires after five years what options do you have if you do not have a job and you have decided not to use the rav or you do not qualify for the rav bearing in mind that extensions for Uk citizens are no longer easy after brexit with strict quotas of number of permits they will allow
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Old 30.12.2020, 13:46
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Re: CGT on foreign property

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Thank you Farman. As usual a fountain of wisdom

Just two short questions if I may

1) are you sure about your example of June 2020 meaning the earliest to leave is 6 April 2026? I have to say that I have not seen any guidance on this from hmrc website and I thought it was five years departure but you seem to have interpreted that as five years not including split tax years. Do you have any links to support that because that could mean a further year of residence required

I mean suppose someone came 6 April then that could make a difference then if they came on 4 April as an extreme example

2) if what you say is correct and your permit expires after five years what options do you have if you do not have a job and you have decided not to use the rav or you do not qualify for the rav bearing in mind that extensions for Uk citizens are no longer easy after brexit with strict quotas of number of permits they will allow
The rule is 5 tax years, the UK tax year runs 6th April to 5th April the following year. 6th April is a day too late, so you would need to physically leave the UK earlier.

Then you would have to go 'on holiday' for as long as required or get a job, any job in another country rather than return to the UK. The whole point is, tax avoidance is not made easy to achieve.

EDIT, from Phil's link, you need to look closely, possibly you need 6 years & 5 UK tax years.

When do the temporary non-residence rules apply?
Very broadly, you will be temporarily non-resident in the UK if:

you have been resident in the UK for at least four tax years (out of the seven tax years prior to departure); and
you leave the UK and become non-resident; and
you then return to the UK after a period of non-residence lasting five years or less.

Last edited by fatmanfilms; 30.12.2020 at 13:56.
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Old 30.12.2020, 14:42
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Re: CGT on foreign property

Based on the following two links it actually appears you need to be out of UK for seven years !!

All those buying and selling shares in CH should take note if they plan to return to UK


"Mr Simmons, who has lived all his life in the UK, leaves the UK on 5 August 2019.

He returns to the UK on 2 September 2022.

He realises a chargeable gain (on an asset acquired before he ceased to be resident in the UK) of £15,000 on 20 April 2020.

For both 2019-20 and 2022-23 split year treatment does not apply and he was not Treaty resident in another territory in either of these years.

Mr Simmons fulfils all the conditions in TCGA92/S10A*.

2022-23 is the period of return.
2019-20 is the year of departure.
Period A ends on 5/4/20.
The period of temporary non-residence is 6/4/20 to 5/4/22, which is 5 years or less.
He had sole UK residence for at least four out of the seven tax years immediately prior to his year of departure.
A chargeable gain accrues to Mr Simmons in the period of temporary non-residence.



https://www.gov.uk/hmrc-internal-man...manual/cg26565

https://www.gov.uk/hmrc-internal-man...manual/cg26500
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Old 31.12.2020, 03:54
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Re: CGT on foreign property

I sold UK property in 2019 and things have changed quite a bit since I last sold in 2003.

1. CGT must be reported and paid within 30 days
2. Non-residents are not exempt from CGT
3. You can use a valuation made just before 6th April 2015 when non-resident CGT was introduced to calculate the base for the increase. My valuations were estimates made my a friend of a friend in the industry. When you include your calculation in your tax return the UK asks if you paid for your valuation, so maybe that makes it seem more legit in their eyes.
4. The Swiss don't care - I paid CGT in the UK - I just removed it from the tax declaration.

https://www.gov.uk/guidance/capital-...ntial-property

NOTE: "You have 30 days from the date of conveyance to report your disposal and pay any tax due. You’ll get a late filing penalty and be charged interest if you do not do this by the 30-day deadline."

This is why I always do my own taxes and read the rules myself, as no accountant could have helped me with that come the usual tax time.

Last edited by CH_Me; 31.12.2020 at 03:59. Reason: more details on valuation
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