Capital Gains Tax

ConnyD

Hello All,

If I'm making this post in the wrong forum, I apologise and perhaps someone could direct me to the right one.

My wife, who is an Indonesian National and resident UK tax payer, wants to sell land she owns in Indonesia. Will she have to pay UK gains tax?

chrismac1

A UK resident pays tax on their worldwide gains. She is entitled to claim non-domicile status which then means she is taxed on remitted monies - i.e. only if the proceeds come back to the UK. However, by ticking the non-dom box this gives her a potential £30k tax bill straight away - but only if she has resided in the UK for 7 out of the last 10 tax years. Also a non-dom must have an intention to return to the mother ship. The £30k goes up to £50k in 2012 for folk who've been here 12 years.

This in my view is worth getting paid professional advice on, as the sums involved are big and small changes in circumstances can make a big difference.

jimmo

If your wife wants to sell the land and remit the proceeds(bring the money) to the UK then she will definitely be liable to UK Capital Gains Tax on her Capital Gains.
If she is a non-dom there are all sorts of clever things she may be able to do to avoid paying UK Capital Gains but basically they all rely on making sure that she only remits her original acquisition value of the land and does not remit the gain.
Probably the most important question is how much Capital Gain will she realise?
That may be complicated enough but we can probably sort that out on here.
Once you know the amount of the Capital Gain you should be able to judge whether it is worth your while taking professional advice.
How much does she expect to sell the land for?
How much did she buy it for or how much was it worth when she acquired it?