ttfg1
Blogger
Share this content
0
1856

2013 Finance Bill change?

2013 Finance Bill change?

Hi

Is it me or does the 2013 Finance Bill change the 5 year non residence requirement for CGT?

Looking at the Finance Bill it states that the temporary non residence provisions apply "if the period of temporary non residence
is 5 years or less."

Before 6 April 2013 you could avoid the temporary non resident provisions by remaining abroad for at least 5 complete tax years.

This would indicate to me that you have to be non resident for 6 years where you leave after 5 April 2013 - or have I missed something?

Thanks

Tim

Replies

Please login or register to join the discussion.

09th Feb 2013 09:35

You are quite correct, and it is noted as a change in the Finance Bill notes

 

I quote

"The provisions in this Part apply if the period of temporary nonresidence is 5 years or less. This is a change from the current temporary non-residence provisions which apply if there are no more than 5 tax years (‘intervening years’) between the year of departure and the year of return."

 

The consulation document in June mentioned this:-

"The consultation proposed a new anti-avoidance rule to counteract the risk of individuals creating artificial, short periods of non-residence to receive income free of tax when it accrues during a period of residence and would otherwise be liable to UK tax. This would be similar to the existing rule which applies to capital gains which treats gains arising in a temporary period of non-residence as accruing to the taxpayer in the year of return." Mow the CGT rules also were the 5 tax years as you mentioned!!

 

But the document also goes on to say:-

"The Government confirms that the new rule will be modelled on the existing capital gains rules and will apply where:
• an individual has been resident in four or more of the seven tax years prior to the
tax year in which they become non-resident; and
• becomes resident again within five years of leaving."

 

 

 

 

 

 

Thanks (1)
avatar
By ttfg1
09th Feb 2013 17:03

Many thanks for this. I thought I was going crazy as I'd read and reread the finance bill.

It looks as though they've changed their position then from the June consultation document.

Thanks again

Tim

Thanks (0)
Share this content