Capital Gains Tax on the sale of inherited property abroad

Hi Team. I'm a UK citizen who spent over 8 years abroad with my late husband. Unfortunately, he passed away in 2021, and I inherited his house abroad in June 2022. I sold the property in the same month and the funds were deposited into my UK bank account. All necessary taxes for the sale were settled abroad, and I wasn't a UK resident when the property was sold. I made a short visit to the UK in July 2022 and then permanently returned in October 2022. I'm seeking clarity on whether I must report the property sale on my self-assessment and if there's a potential liability for Capital Gains Tax (CGT). Your prompt guidance on this matter would be highly appreciated. Thank you in advance.

Hi,

If you were not UK resident in the tax year in which the property was disposed of, then you do not need to report the disposal to HMRC.

If you were resident in the UK in the tax year in which the property was disposed of, then you will need to declare the disposal in a Self Assessment tax return. You will need to work out if there was a capital gain, using UK rules, which can be found here:

Capital Gains Tax

Thank you.

Thank you very much fr your reply. I have checked the criteria and am confident that I am qualified for split year arrangement and it's not necessary to report my foreign income ( CGT too) received before coming to UK on 14th of July2022 (inhereted house abroad sold in June2022). Could you please confirm if i understood correctly? Do I still have to declare it on my Self Assessment tax return ( I am doing it every year for UK rental income as my UK home was rented out since I left UK 8 years ago and until I came back to UK to live permanently). Thank you.

Hi,

As you are claiming split year you do not need to declare it. You will need to ensure that the residence section of the return is completed to confirm this, and as you cannot file this online with HMRC software, you will need to purchase third party software .

Self Assessment commercial software suppliers

Thank you.