Tradefair & Financials
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At the moment theoretical but say
(1) I marry a New Zealander and transfer a property with a potential gain of £100k say
- I assume nil CGT on trnasfer to spouse
(2) We stay in New Zealand for oen tax year and seh seels the property : Currently New Zelaanders pay no CGT
I assume she pays no CGT
(3) Come back to Britain
I trained as an accountant believe it or not and would get tax adice but before I bother would like to know if anyone knows if this is a perfectly legal way of not paying CGT
(1) I marry a New Zealander and transfer a property with a potential gain of £100k say
- I assume nil CGT on trnasfer to spouse
(2) We stay in New Zealand for oen tax year and seh seels the property : Currently New Zelaanders pay no CGT
I assume she pays no CGT
(3) Come back to Britain
I trained as an accountant believe it or not and would get tax adice but before I bother would like to know if anyone knows if this is a perfectly legal way of not paying CGT
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wouldn't the cost of becoming non-resident (eg moving, loss of income, travel, insurance etc etc) outweigh any CGT savings? seems a lot of work and time to save 20-30k. and If I was your theoretical wife I'd file for divorce the minute I landed in NZ.
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If it's a residential property can you move into it for a 'reasonable period of time' so that it becomes your PPR thus avoiding CGT?
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Have not used the real numbers , basically bought 15 properties between 1999 to 2001.
I trained CIMA and barely scrapped my tax exams The actual gains are more like £2million so potential CGT bill over £500k I agree otherwise not worth it. I have been advised if I moved into a property bought for say £90k and now worth £250k If I just sell would get two lots of CGT relief but still be left with a 140 gain less expenses. If move in we could each claim 40k letting allowance, so thats £80k , then the CGT allowance and then taper relief for the last three years of ownership. That would leave only ~ 30k and am advised an IS could defer and this gain if held more than three years into a year with nil gain However thats only one property another 14 to go and a thumping amount to pay if all sold. Actually selling up and merely renting in New Zealand would be the idea |
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meant to say putting 30k into an EIS not an IS
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The actual gains are more like £2million so potential CGT bill over £500k I agree otherwise not worth it.
If it is classed as a business asset then you can get 75% taper relief if held for more than two years. For a higher rate tax payer that would represent an effective 10% rate so 'only' 200k That's assuming you didn't trade under a company, if you have then it is a different calculation. |
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not wanting to rub it in but no capital gains tax for NZ residents (unless technically a trader) on property, share appreciation and even dividends may be imputed.
in your case a good tax accountant would seem to be a worthwhile investment. |