Non-Resident Capital Gains Tax: Selling UK Property as an Overseas Owner

For a long time, leaving the UK genuinely meant leaving UK Capital Gains Tax behind for most assets, property included. That changed for residential property in April 2015, and again for commercial property and company shares in April 2019, so a non-resident selling almost any UK property or property-rich business today is inside the same CGT regime as someone who never left — with a filing deadline that is easy to miss precisely because it applies whether or not there is any tax to pay.

What actually falls within the charge

Non-Resident Capital Gains Tax, usually shortened to NRCGT, brought UK residential property held by non-residents into the scope of CGT from 6 April 2015. From 6 April 2019, the charge was extended to cover UK commercial property held directly, and to indirect disposals — selling shares or an interest in a company, partnership or trust that derives at least 75% of its gross asset value from UK land, where the seller holds, or has held within the previous two years, a 25% or greater interest in that entity. That second limb specifically targets structures where UK property is held through an offshore holding company rather than owned directly, closing what had previously been a straightforward route around the charge.

The rules apply to individuals, trustees, personal representatives and companies alike, though companies and individuals are dealt with under different mechanisms, covered below. It makes no difference whether the non-resident ever lived in the UK, has any other UK income, or holds the property through a UK bank account — residence status for tax purposes, not location of the asset's paperwork, is what determines whether NRCGT applies, and that status needs testing under the Statutory Residence Test in its own right.

The 60-day return: a filing duty, not just a tax one

A non-resident disposing of UK land or property must submit a UK property return to HMRC within 60 days of completion, and pay any tax due within the same window. Critically, this filing obligation exists regardless of whether tax is actually owed: a full or partial exemption, a loss on the disposal, or an available relief does not remove the requirement to report, it simply reduces or eliminates the amount due once reported. This is a materially different position from most UK residents, who generally only need to make a 60-day CGT return where tax is due on a residential property disposal, and can rely on being outside a reporting obligation entirely when a relief covers the gain in full. A non-resident does not get that same benefit of the doubt; the return is due either way, and missing it triggers penalties calculated from the deadline even where the eventual tax bill is nil.

Where a company is disposing of UK property, the position changes again. Non-resident companies have been brought fully within the charge to UK Corporation Tax on gains from UK property since 6 April 2020, rather than remaining within the personal CGT regime, so the gain is computed and taxed under Corporation Tax rules and reported accordingly, though a 60-day property return is still generally required around the disposal itself unless the company already has an established Corporation Tax filing relationship that HMRC accepts covers it.

Rebasing: only the gain since you were brought into scope is taxed

NRCGT was never intended to tax gains that accrued before non-residents were brought into scope at all. For residential property owned before 6 April 2015, the default position rebases the base cost to the property's market value at that date, so only growth in value from April 2015 onwards is taxed, with an election available instead for time-apportionment or a full computation over the whole period of ownership if that produces a better result. Property and shares brought into scope from 6 April 2019 — commercial property and property-rich company interests — get the equivalent rebasing to their April 2019 value. Getting a contemporaneous valuation at the relevant rebasing date, rather than trying to reconstruct one years later when a sale eventually happens, is one of the more valuable pieces of housekeeping an overseas owner can do early.

Rates, and why they are not always what people expect

Non-resident individuals pay CGT at the same rates that apply to UK residents disposing of residential property, with the lower and higher rates depending on the individual's total UK taxable income and gains for the year, notwithstanding that most or all of that income may itself be non-UK. Non-resident companies, by contrast, are taxed under Corporation Tax rather than CGT rates, which changes both the computation and the interaction with any losses or reliefs the company holds elsewhere. Which regime applies is not a matter of choice; it follows directly from whether the seller is an individual, trustee or company, and gets the structuring decision behind a non-resident's UK property holding — personal ownership, an offshore company, or something else again — wrong in one direction or right in the other well before any sale is contemplated.

Private Residence Relief for a non-resident

A non-resident can still claim Private Residence Relief on a UK property that was genuinely their home, but only if they meet a day-count test: at least 90 midnights spent in that property, or across their UK properties in aggregate, during the tax year in question. A non-resident who owned a UK home but visited only occasionally, without clearing that threshold, will not qualify for the relief for that year even where the property was unquestionably their only UK residence. This is a narrower test than the one facing a UK-resident owner, discussed in our guide to Private Residence Relief, and it is worth modelling deliberately for anyone splitting time between the UK and overseas around a planned sale.

How this sits alongside the other non-resident charges

NRCGT is only one of three separate non-resident regimes that can apply to the same portfolio, and confusing them is a common and expensive mistake. The non-resident SDLT surcharge is a 2% addition to Stamp Duty Land Tax charged on the way in, when the property is purchased. The Non-Resident Landlords Scheme governs how UK rental income is taxed and reported while the property is held. NRCGT is the charge on the way out, when the property or the entity holding it is eventually sold. A non-resident landlord can be entirely compliant on the first two and still miss the 60-day return on disposal, because it is the one triggered by an event that, for someone no longer in the UK, is easy to let slip past without the same local prompts a UK resident would have.

Common questions

Do non-UK residents pay capital gains tax on UK property?

Yes. Since April 2015 for residential property, and April 2019 for commercial property and property-rich company shares, non-UK residents are within the scope of UK CGT on gains from UK land and property, regardless of where they live.

How long do I have to report a UK property gain if I live abroad?

60 days from completion of the disposal, and this applies even where no tax is due because the gain is covered by a relief or the property sold at a loss. Most UK residents only need to report within 60 days where tax is actually owed.

Can a non-resident claim Private Residence Relief on a UK home?

Only if they spend at least 90 midnights in that property, or across their UK properties collectively, during the relevant tax year. Without meeting that threshold, the relief is not available even if the property was genuinely their home.

Does non-resident CGT apply to commercial property?

Yes, since 6 April 2019, alongside indirect disposals of shares in companies deriving at least 75% of their value from UK land where the seller holds a 25% or greater interest, with values rebased to April 2019 for assets already held.

This article is general information, not personal tax advice, and tax rules change. Your own position depends on facts we cannot see from here — please take advice before acting on anything above.

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