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We inherited dad’s house in the UK – where to pay capital gains tax?

Sisters who moved countries find tax and administration penalties could eat into their inheritance.

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Q: My mum’s house in the UK has been sold. My dad had left it to my sisters and me when mum was no longer able to live there. I have to pay capital gains tax (CGT) on the amount the house has gained since he wrote his will. This is divided by three. I now have the money, but I need to know whether to pay CGT in the UK. My sister in Melbourne has been informed she pays here, but my financial adviser has advised me to pay in the UK, and complete a tax form there. I haven’t completed a tax form in the UK in over 30 years. Heather

The wisdom: Capital gains from the disposal of UK land and property will always be subject to CGT in the UK in the first instance, says Mike Ward, tax director of Menzies in the UK. Non-UK residents are required to report the disposal, and pay any capital gains tax to the UK tax authority (HMRC) within 60 days of sale completion by submitting a UK land and property return.

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    Original URL: https://www.afr.com/wealth/personal-finance/we-inherited-dad-s-house-in-the-uk-where-to-pay-capital-gains-tax-20240625-p5jomg