Capital gains tax - Who do I pay: Irish or UK Revenue?

Charlie-Bravo

This question isn't for me but for a relative who lives and works in the UK. He owns a house in the west of Ireland. Should he sell the property, should he pay capital gains tax to the Irish revenue or UK revenue??

Also, what rate of capiatl gains tax would apply?

jnh

as the house is located in ROI it will primarily be liable to ROI CGT, currently at 25%. he will then need to submit a UK return outlining the CGT due. The rate in the UK is 18%. He will be given a credit for the ROI tax paid. thus he will have no UK CGT liability as he will have already paid 25% CGT in ROI.

Charlie-Bravo

Thanks for that jnh. Very interesting how that works.

Mr. Incognito

Hi Astro,

I'd advise your relative to seek competent professional advice in the UK. As he is UK resident it is really the UK's taxation rules that will apply.

As the land is Irish situate a charge to Irish CGT applies but relief is due under double taxation treaties.

It's really one for a professional.

jnh

uk rules for disposal of overseas (non uk) assets:

1. resident and domiciled in UK - liable to UK tax
2. resident not domiciled in UK - liable to UK tax if remitted to UK

either way ROI tax will apply at 25% so you will have no additional UK tax

Hackysack

Maybe i'm completely wrong, but I always thought CGT was 20% in ROI...

jnh

the last two budgets changed the CGT rates

The_Hustler

If we want the taxation forum to develop I think questions like this should be moved there.

Jnh's answer seems correct to me.