HMRC Admin 32 Response

Hi,

There may be Capital Gains Tax to pay, as the property was disposed of while you were resident in the UK. You may find that private residence relief will cover any gain that arises, so you would need to work out if a charge to capital gains tax arises. You will need to convert the buying costs to pounds sterling, using the official exchange rate in force at the time of purchase, including purchase costs such as legal fees. 

CG15250 - Expenditure: incidental costs of acquisition and disposal

You will also need to do the same with the disposal value and selling costs. There is a calculator below which you can use to work out any gains.

Tax when you sell your home

If a gain arises and tax is payble, you will need to report the gain on a Self Assessment Tax Return.

Thank hyou.

Hi,

No.  If you’ve filled in the ‘Capital gains summary’ pages (SA108) and you’ve paid foreign tax on those gains, and you want to claim 
Foreign Tax Credit Relief for the foreign tax, fill in box 33 and boxes 37 to 40 (page F6) of SA106. Do not include these amounts in box 2 on page F 1.

Foreign (2023)

Thank you.

Hi,

Section 9.11 & 9.12 below, is the guidance that applies for the exemption for small amounts of foreign income.

Residence, domicile and the remittance basis: RDR1

As you cannot register to submit a tax return online, you will need to download and print off a paper tax return.  

You can do this at:

Self Assessment tax return forms

Thank you.

Hi,

It is possible that you will be subject to capital gains when you dispose of the property. Capital gains is the disposal value, minus buying and selling costs (including purchase price). As this is not your main residence, you will not be entitiled to private residence relief.  

General maintenance, such as, replacement boiler, roof, windows etc, are considered revenue expenses and cannot be set against any gains. 

CG15150P - Capital Gains manual: introduction and computation: computation: expenditure

Thank you.

Hi,

Any pension paid from the QROPS will be taxable if the member is UK resident when they receive the pension. To the extent that a lump sum payment is outside the scope of the member payment provisions, lump sums paid to UK residents may be taxed as pension income. 

PTM112010 - International: qualifying recognised overseas pension schemes (QROPS)

The five-year rule was introduced when QROPS were first established in 2006. It applies to the first five years of your residency status if you transferred your pension to a QROPS before 6 April 2017. Ultimately you must have been UK non-resident for five consecutive tax years ahead of retiring or beginning to draw from your QROPS.

Article 20 of the double taxation agreement with India, advises that pensions and annuities are taxble in the UK. 

India: tax treaties

Thank you.

Hi,

Where a person is liable to pay Class 2 National Insurance contributions (NICs), Class 2 NICs are due for each contribution week or part of a week that a person is self-employed. So, where a person is self-employed and liable to pay Class 2 NICs for part or all of one day in a week, liability arises for one week’s NICs due at the weekly flat rate.                                                                                                
Class 2 NIC are a fixed weekly amount – £3.45 per week for 2023/24 (£3.15 per week for the 2022/23 tax year) if you have made sufficient profits (see below).

The rules for Class 2 NIC changed for the 2022 to 2023 tax year onwards.

Prior to the 2022 to 2023 tax year you needed to pay Class 2 NIC if your profits were above the Small Profits Threshold. 

For 2022 to 2023 onwards, you pay Class 2 NIC if your profits are above the Lower Profits Limit (which is £12,570 in 2023/24 and was £11,908 in 2022/23). If your profits are below the Small Profits Threshold (£6,725 in 2022 to 2023 and 2023 to 2024) then you can choose to pay voluntary Class 2 NIC. If your profits from self-employment are between the Small Profits Threshold and the Lower Profits Limit then there is no Class 2 NIC to pay, instead you will be treated as making Class 2 NIC. This will mean you will be able to access entitlement to contributory benefits in the same way as if you had paid Class 2 NIC.

For 2023 to 2024 onwards, the Lower Profits Limit will be the same amount as the personal allowance for income tax (£12,570 for 2023 to 2024).

A ‘contribution week’ is defined as a period of seven days beginning with midnight between Saturday and Sunday. The first day of the contribution week is Sunday and Saturday is the last. The first week of the contribution year starts on the first Sunday after 5 April.

Thank you.

Hi,

If a detailed breakdown of your annual gains and losses is not provided by your broker, a declaration of total gains and losses would be acceptable. Please however attach a copy of the gains and losses summary provided by your Interactive Broker when you submit your Self Assesment return.

Thank you.

Hi,

Yes, Foreign Capital Losses can be set against UK Capital Gains. Detailed guidance on quantifying, calculating and claiming Capital Losses is provided at CGT15800.                                                
CG15800 - Losses: allowable losses

Thank you.

Hi,

The first £30000.00 of the redundancy payment is tax free.  Anything over this sum is shown in box 5 of SA101, page Ai2.  The guidance advises: 

"This includes:
•    redundancy pay
•    post-employment notice pay
•    compensation for loss of office
Include the amount of taxable post-employment notice pay and the amount of the balance of the payment which is above the £30,000 exemption limit. Do not include any amount of the payment which is not taxable, either because it is specifically exempted or because it is taxable overseas and not in the UK. The amount up to the £30,000 limit goes in box 9."

Additional information notes

Additional information (2023)

Thank you.

Hi,

You will need to include both the overseas interest and the UK interst on the tax return. If your overseas interest and dividends are less than £2000.00, you can record this in page TR3 of SA100, otherwise you need to report the overseas interest on SA106. Your split year treatment would commence from your arrival date.

Thank you.