SolvedCG73897 | Non-Resident Capital Gains Tax (NRCGT) – Disposals on or after 6 April 2015 to 5 April 2019: Interaction between Non-Resident CGT and ATED-related CGT: Gain or loss not ATED-related or NRCGT computations, examples
From HM Revenue & Customs · Capital Gains Manual
1. Balancing gain or loss calculated under para 17
2. Balancing gain or loss calculated under para 18
3. Balancing gain or loss calculated under para 19
1. Balancing gain or loss calculated under para 17
For the ATED-related gain or loss in this scenario see example 1 in CG73643.
For the Non-resident CGT gain or loss in this scenario see example 1 at CG73877.
Basic information:
Residential property acquired April 2006 for £3,000,000 and disposed of April 2016 for £6,000,000.
The property had a value of £5,000,000 at 5 April 2013 and a value of £5,600,000 at 5 April 2015.
Total number of days chargeable to ATED (say) 700
Pre April 2015 ATED chargeable days 365
Post April 2015 ATED chargeable days 335
Post April 2015 S14D (NRCGT) chargeable days 30
Total days 6 April 2013 to 5 April 2015 730
Total days 6 April 2015 to disposal 365
Estimated Indexation factors:
April 2006 to April 2013 0.3
April 2015 to April 2016 0.035
April 2013 to April 2015 0.078
Balancing gain or loss belonging to the notional post-April 2015 gain or loss
Determine the amount of the post-April 2015 gain or loss
Disposal proceeds £6,000,000
Market value at 5 April 2015 £5,600,000
Indexation allowance £196,000
Notional post April 2015 gain £204,000
Balancing fraction
BD = balancing days in appropriate ownership period 0
TD = total days in appropriate ownership period 365
BD/TD x notional post-April 2015 gain = 0
Balancing gain or loss belonging to the notional pre-April 2015 gain or loss
Determine the amount of the pre-April 2015 gain or loss
Market value at 5 April 2015 £5,600,000
Market value at 5 April 2013 £5,000,000
Indexation allowance £390,000
Notional pre April 2015 gain £210,000
Non-ATED related fraction
NAD = Non-ATED chargeable days 365
TD = Total days in appropriate ownership period 730
NAD/TD x notional pre April 2015 gain = £105,000
Notional pre-April 2013 gain
Market value at 6 April 2013 £5,000,000
Acquisition cost £3,000,000
Indexation allowance £900,000
Notional pre April 2013 gain £1,100,000
Add together:
Balancing gain belonging to the notional post-April 2015 gain £0
Balancing gain belonging to the notional pre-April 2015 gain £105,000
Notional pre-April 2013 gain £1,100,000
Balancing gain (neither ATED-related not an NRCGT gain) £1,205,000
| Summary | ||
|---|---|---|
| ATED-related gain | 667,123 | The unindexed gain across the 700 ATED chargeable days |
| NRCGT gain | 16,767 | The indexed gain across the 30 NRCGT chargeable days |
| Balancing gain | 1,205,000 | The indexed gain across the 2,920 balancing days in the ownership period |
| Total gains | 1,888,890 |
2. Balancing gain or loss calculated under para 18
For the ATED-related gain or loss in this scenario see example 2 in CG73634.
For the Non-resident CGT gain or loss in this scenario see example 1 at CG73884.
Basic information:
Residential property acquired October 2015 for £1,500,000 and disposed of April 2018 for £2,500,000.
Estimated Indexation factor October 2015 to April 2018 0.20
Total number of days chargeable to ATED 730
Total S14D (NRCGT) chargeable days 913
Total days October 2015 to April 2018 913
Determine the amount of gain or loss
Disposal proceeds £2,500,000
Acquisition cost £1,500,000
Indexation allowance £300,000
Gain £700,000
As 730 days are chargeable to ATED, and 913 days are S14D days (NRCGT days), there are no balancing days, and so no balancing gain.
The calculation would be:
BD = 0
TD = 913
BD/TD x £700,000 = 0
If there were days in the relevant ownership period which were not chargeable to ATED or NRCGT (because, for example, the building was not a dwelling), these would be balancing days and so there would be a balancing gain.
| Summary | ||
|---|---|---|
| ATED-related gain | 799,562 | The unindexed gain across the 730 ATED chargeable days |
| NRCGT gain | 140,307 | The indexed gain across the 913 NRCGT chargeable days |
| Balancing gain | 0 | No balancing gain as there are no balancing days in the ownership period |
| Total gains | 939,869 |
3. Balancing gain or loss calculated under para 19
For the ATED-related gain or loss in this scenario see example 3 in CG73628.
For the Non-resident CGT gain or loss in this scenario see the example at CG73891.
Basic information:
Residential property acquired April 2010 for £300,000 and disposed of 7 April 2018 for £700,000.
The property had a value of £500,000 at 5 April 2015 and £550,000 at 5 April 2016.
Estimated Indexation factors are:
April 2015 to April 2016 0.013
April 2016 to April 2018 0.019
April 2010 to April 2015 0.158
Total number of days chargeable to ATED 200
Total days 6 April 2016 to day preceding disposal 730
Pre April 2016 S14D (NRCGT) chargeable days 365
Post April 2016 S14D (NRCGT) chargeable days 530
Balancing gain or loss belonging to the notional post-April 2016 gain or loss
Disposal proceeds £700,000
Market value at 5 April 2016 £550,000
Indexation allowance £10,450
Notional post-April 2016 gain £139,550
Balancing fraction
BD = balancing days in appropriate ownership period 0
TD = total days in appropriate ownership period 730
BD/TD x notional post-April 2016 gain = 0
Balancing gain or loss belonging to the notional pre-April 2016 gain or loss
Market value at 5 April 2016 £550,000
Market value at 5 April 2015 £500,000
Indexation allowance £6,500
Notional pre-April 2016 gain £43,500
BD = balancing days in appropriate ownership period 0
TD = total days in appropriate ownership period 365
BD/TD x Notional pre-April 2016 gain = 0
Notional pre-April 2015 gain or loss
Market value at 5 April 2015 £500,000
Acquisition cost £300,000
Indexation allowance £47,400
Notional pre-April 2015 gain £152,600
Add together:
Balancing gain belonging to the notional post-April 2016 gain £0
Balancing gain belonging to the notional pre-April 2016 gain £0
Notional pre-April 2015 gain £152,600
Balancing gain (neither ATED-related not an NRCGT gain) £152,600
| Summary | ||
|---|---|---|
| ATED-related gain | £41,095 | The unindexed gain across the 200 ATED chargeable days |
| NRCGT gain | £144,817 | The indexed gain across the 895 NRCGT chargeable days |
| Balancing gain | £152,600 | The indexed gain across the 1,825 balancing days in the ownership period |
| Total gains | £338,512 |