Tax Question

katp1984

Hi,

I am a higher rate tax payer. I am selling some property in India which I inherited from my father.

My question is will I have to pay any tax on this money in the UK (if I transfer it over from an Indian bank account) - I want to pay off my mortgage. I will already have paid CGT in India on the property sale.

Thanks
Kevin:money:

Elaine_Wilson

There is no UK tax on simple money transfers.

Depending on your residence and domicile status there may be a liability to tax on any interest earned in the Indian bank account. Possibly also capital gains tax subject to the double taxation agreement of which I know nothing.

I thought I would bump this up in the hope someone more knowledgeable can answer the question.

katp1984

Hi,

Thanks for your replies - it seems vey confusing! I'm not sure what you mean by domiciled - I've been a British citizen for about 20 yrs and pay tax in the UK. I am also an Indian citizen but other than property dont have any assets in India. I live in the UK so I think that makes me resident and domiciled in UK?!

My plan was to sell the property - I will have to pay 20% CGT in India on pretty much the whole amount as they calculate CGT as the difference between initial purchase price (about 70yrs ago - £4!) and sale price (approx £600,000). I was then going to transfer over £200,000 to pay off my mortgage here and leave the rest in an Indian savings account as you earn higher interest there.

From what I understand from your post jimmo, will I also have to pay CGT at 18% here as well? Seems a bit unfair. What if I dont bring the money over to the UK?

Thanks once again for your replies - they have been really helpful.