CGT losses for non-doms

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We have been approached by a potential client who is non-domiciled, and has substantial share portfolios both onshore and overseas.  He believes he should have been advised to make an election under Section 16ZA, TCGA 1992, to allow his overseas capital losses to be used against future gains.  Obviously, the deadline for doing so has passed, and it is no longer possible.

The client has had substantial UK losses, whilst still paying a considerable amount of CGT in most years.  He has also made significant offshore gains which have escaped CGT due to his non-dom status.

I believe that he has not been compromised at all (yet, future losses and any gains ultimately remitted may be a different story!).  Indeed if the election had been in place he would have suffered more CGT.  I base this on Section 16ZC, which seemed to indicate that not only overseas losses but UK losses needed to be matched against overseas gains first, remitted or not.  Therefore he would have effectively lost the benefit of his UK losses.  However, that section was repealed by Finance Act 2019.  What I am not sure of is whether the matching rules for offsetting losses also changed at that time.  I can’t see anything which indicates they have, but then why the need to repeal that section?

I would be most grateful if anyone could point me in the direction of the matching rules for offshore losses since Section 16ZC was repealed.

James

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By Tax Dragon
29th Oct 2020 09:50

Sch1, as substituted by FA 2019?

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