Non-residents selling UK residential property will be subject to CGT on disposals from April 2015.Currently they are exempt from CGT on disposals of investment property providing they are non resident for at least 6 tax years.
The changes will therefore have a massive impact on on residents selling any kind of residential property. So sales of former homes or buy to lets will be within the scope to UK CGT.
Whilst the higher rate of CGT is 28% its worthwhile bearing in mind the following factors:
It won't apply to sales of commercial property. So non-residents can still sell this free of CGT
The 28% CGT charge is based on your other UK taxable income. So if you're non-resident and have no other UK income or gains the first £32K of gain (approx) would would taxed at 18%. In addition you'd also have the annual CGT exemption to offset first as well. This means that for a couple the effective CGT charge on gains less than around £100K would be significantly less than 28%. A joint gain of £100,000 for instance could have an effective CGT rate of just 15%.
The new CGT charge applies to gains from April 2015. There are various ways that you can calculate this. In particular you can value the property at April 2015 and only pay CGT on any uplift in this value on disposal or you can time apportion any gain over your total period of ownership and just pay CGT on the gain from April 2015.
You can still reduce any gain by claiming Principal Private Residence relief but these rules are changing quite a bit from April 2015 as well. In particular you won't be able to qualify for the PPR relief exemption unless you are either resident in that country (ie the UK if you want to claim relief on UK property) or you spend at least 90 nights in that country.
The problem with the 90 nights requirement is that you may then be UK tax resident depending on your other ties etc under the statutory resident test.There are various options where you can avoid becoming a UK tax resident and still qualify for the PPR relief exemption (eg see How to establish non residence and still qualify for PPR relief.
We've summarised the interaction of the various rules for non-residents from April 2015 in this tax calculator:
Residential Property CGT Calculator For Non-Residents
