CGT liability on sale of former PPR in UK

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Funnyname

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Selling property I co-owned in the UK to my friend who owns the other half. I lived in the house for 4 years and moved back to Ireland 5 years ago.

I went through the UK calculation below with all the details required and it gives me a UK liability of £0 however do I have an Irish CGT liability or does the UK override Irish given I lived and owned the house for a number of year before moving back to Ireland
 
If you moved back to Ireland 5 years ago you are now resident and ordinarily resident from a tax viewpoint - so there would be a CGT liability to calculate - did you make a gain when you disposed of your half of the property?

What is your tax domicile - Irish or foreign? this will have a bearing on whether the tax is due or not?
 
Irish resident

I'll post figures here later when I have a few more mins and show uk calc vs irish calc.

Accidental landlord who didn't gain anything from rent, hopefully cgt liability isn't huge. If money went into repairs etc does proof need to be provided? Also does indexation come into it.

I will look for professional advice but see no harm getting a few things straight here first.

Ideally I should have gone back to uk and been a tax resident to avoid the tax but not an option to uproot family.
 
Irish resident does not prove domicile - domicile is gained at birth and is quite difficult to change. Is you were born outside Ireland, you would have to sever all ties with your birth country, show no intention of ever returning, etc

Indexation only worked up to early 2000s, so if you purchased the house 9 or 10 years ago, then no it does not come into play.

Cost of repairs neither - they are set off against the rental income unless they are structural upgrades or suchlike - about 50% of the gain is taxable given the periods you quote above ie 4 and 5 years
 
My figures

initial house price - 150,000
deposit - 25,000
stamp duty - 4,500
solicitor fees - 1,000


agreed sale price (3 valuations, took mid price) - 260,000
 
This is not clear -
is 150,000 the cost of half the house or the full house?
is 260,000 the sale price of half the house or the full house?

Presumably it is in £s
 
to work out your capital gain, and you tax liability, you need to convert the acquisition cost (purchase price and costs) into euros using the EUR/GBP exchange rate at the time of purchase and the expected net sale proceeds (sale price less fees, etc) using the current EUR/GBP exchange rate.

You get relief for the period of time the property was your PPR + 1 year so that would be (4+1) years out of the period you owned the property 9 year

So the taxable gain is 4/9ths of the total gain less the annual allowance (assuming you have no other capital gains in the year) of 1,270 euro
 
So with sterling being stronger at purchase than at sale that's good for me?

Thanks for your help, will send off a few emails to advisors I've found online, anyone have any recommendations?
 
jpd said:
You didn't answer my question about your tax domicile status?
Click to expand...

@jpd I am in a similar situation of selling a house in the UK. I am a tax resident in Ireland but my domicile I guess is the UK as I was born in the North and had a British passport. I thought the domicile meant I had only had to pay tax on the gains on a remittance basis, is it possible I wouldn't have to pay CGT in Ireland?
 
if you are tax domiciled abroad, then yes you pay CGT on gains remitted
 
When you say tax domiciled, I take it you mean who you pay your paye tax to.

So you could like in Ireland and work in the North and so pay your taxes to the crown so therefore you are uk domiciled for taxes even tho you live in Ireland?
 
No, you generally acquire tax domiciliation by birth.

When you move to another country, your tax residency status changes quite quickly but changing your tax domicile is much more difficult.

From the Revenue website
What is domicile?
Domicile is a concept of general law. It broadly means living in a country with the intention of living there permanently. Domicile is a much more permanent concept than residence.

Everyone has a ‘domicile of origin’ at birth (usually the domicile of the father). You keep your domicile of origin unless you choose to gain a new domicile.

To gain a new domicile, you must show clear evidence that you:

  • intend to live permanently in the new country
  • do not intend to return to live in your domicile of origin.
Your domicile affects how foreign-source income is taxed in Ireland.
 
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