UK & Canada CGT Query

I need help understanding the UK & Canada double tax treaty. I believe if I sell my UK propert it also gets taxed in Canada? Can I get relief for any Canadian tax paid on the sale? Also, if I was to sell the UK residential property as a Non-resident, would I still get relief for any Canadian tax paid?

Hi Lsuki,

You would only get relief on the Canadian tax if you are a UK resident.
As a Canadian resident you would claim relief for the UK tax.

Thank you.
 

Hi, Thanks for your response. Can you please elaborate why I would get relief in the UK for any Canadian tax paid? The double tax treaty (Article 21) seems to Imply I would only get relief in the UK for any Canadian tax paid on sources within Canada. As the property is in the UK I read that to mean I wouldn't be able to claim any relief for any Canadian tax paid.

Hi, 
 

Correct.  Article 12 of the UK / Canada double taxation agreement, gives the UK the right to charge capital gains tax on the disposal of a UK property first, however, you may also be charged a capital gains tax in Canada.  You may be able to claim a tax credit in Canada, to set against the UK capital gains tax paid, so that you are not charged capital gains tax twice on the same gain. See link : CONVENTION BETWEEN THE GOVERNMENT OF THE UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND AND THE GOVERNMENT OF CANADA FOR THE AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION OF FISCAL EVASION WITH RESPECT TO TAXES ON INCOME AND CAPITAL GAIN   . Thank you.

Hi there, I have purchased shares in a Canadian mining company. If I sell the shares (hopefully for a profit), what tax implications are there for me with respect to Canadian taxes and UK tax liabilities?

Hi Beaker1965,
If you make a gain on their disposal, you may need to pay tax on the gains in Canada.
If you are resident in the UK, you would need to report the gain in a Self Assessment Tax return.
If Capital Gains Tax is payable in the UK on the gain and you paid Canadian tax on the gain, you can claim up to 100% of the overseas tax paid, as a Foreign Tax Credit and set it against any UK CGT arising.
Thank you.