Gains on disposal of a residential property may be subject to UK capital gains tax (CGT), corporation tax, non-resident capital gains tax (NRCGT), or ATED-related CGT (or a combination of these).
Generally, gains must be reported on the relevant self-assessment tax return: NRCGT gains, however, have to be reported separately, within 30 days of the disposal taking place. Penalties apply where a return is filed late. Please see article – CGT for non-UK residents on UK property
For disposals on or after 6 April 2020, this 30 day filing and payment deadline (that currently applies to non-UK tax residents) will be extended to UK tax residents disposing of UK residential property.
Individuals
Individuals selling their only or main residence should qualify for Principal Private Residence relief so that the gain is not chargeable – see article Principal Private Residence relief.
CGT on residential property is charged at 18% or 28%, depending on whether the individual has any basic rate band remaining (after the calculation of their income for income tax purposes).
Non-UK resident individuals are subject to NRCGT at 28% on the gain in excess of the market value as at April 2015, or the acquisition price if later.
Company
A (resident or non-resident) company subject to ATED will be subject to ATED-related CGT at 28% on the gain in excess of the market value as at April 2013, or the acquisition cost if later.
A company which qualifies for an ATED relief should also qualify for relief from ATED-related CGT.
A UK resident company is subject to corporation tax at 19% on gains realised on the disposal of residential property.
A non-UK resident company is subject to NRCGT at 20% on gains realised on the disposal of residential property. This is due to change to corporation tax from April 2020 – see blog Non-UK resident landlord – Tax issues to consider.