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Tax gain for selling a House in UK


Zelanda
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Hi all,

We are in the stressfull proccess of selling our former home in Uk, as we are living in France.

I've been reading the French impots gov web and the rules for calculate tax gain are so complicated that I'm getting mad!

So I have some cuestions that maybe some of you can clarify.

- How I calculate the gain in € ? Should I take the Pound value at the day we bougth the house (less expenses) Vs the pound value at the day we sell (less expenses)? Because if, the gain in € would be a lot less than in pounds.

- Can I deduct the 7.5% in buying charges and expenses as standard, even if the fees and taxes I paid in Uk were less than that, or Should I count the amound I really paid in pounds?

-Can I deduct too the 15% as standard in improvements, because I owned the property for more than 5 years? even if I didn't expend that amoung?

- Can I have the exception if with the gains I buy a house here in France for living?

It would be very very grateful if anyone could answer those cuestions, because I have no idea how much coulld we pay in French taxes.

Regards,
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It's even more complicated because from 2012 (I think) you are liable for UK capital gains on a percentage. I have just sold my UK house.. I know I had to inform HMRC and I did a calculation that said I owed them £750 on the increase in value from the day this law came into force.. I now have to submit something on this years tax form for the French impots but I have no idea how that is worked out. I am getting some tax advice so will let you know what I find out.
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If I was in that position I would sell the house, put the money in my UK bank and transfer what I needed occasionally via my credit card. Not saying that is what you should do but it's what I would do. LOL
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If your living in the house when you sell it then it's not a capital gain is it. At the end of the day it's all about where you claim residency. Sometimes people are so keen to give money to the tax man and what one tax man does not know the other won't know either. You should of course be very careful to ensure you do not illegally evade paying tax. Avoiding tax legally is of course a different matter.
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I was looking for something else but came across this.

https://www.gov.uk/tax-uk-income-live-abroad/taxed-twice

Seems tax on selling your house in the UK is not covered by the dual taxation treaty and therefore you may have to pay twice.

Like I said if only you were living in it when you sold it or the buyers came to view and the deposit paid there would be no gain.
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Thanks Lindal!!!, It's like imports here in France are like a grial secret!.

I calculate the gain tax in Uk an is quite low due I lived in that house most of the time.

But the tax for French residents is a 26.5% !!! (thanks that we have the S1 doc, so we don't pay social charges if not would be a massive 40%) and I don't know what deductions can I apply on that. I know the deductions for French properties but not it they are applicable to foreing properties.

And Also if I could benefy from the exchange game Pound/Euro. The gain in Pound would be around 90000, but it they consider the price in Euros At the day I bougth the house that the exchange was 1.42 versus the selling price in € now that is around 1.17, then the gain in Euros would be the half!! and I save a furtune!!

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"Seems tax on selling your house in the UK is not covered by the dual taxation treaty and therefore you may have to pay twice. "

Not, thats not correct.

First you pay tax in the country where is the house and after that, you complete the tax gain form in the country where you are living, and the Double tax avoiding rule means that France will deduct from French tax, the amoung you already paid in the other country.

And france and Uk have that Dual tax Treaty.

"Like I said if only you were living in it when you sold it or the buyers came to view and the deposit paid there would be no gain"-

Doesn't work exactly like that... That rule is only valid for EU countries (maybe not Uk soon...) and in France to apply that you need to be living in a rented house for four years or have been living in the house you sold until you sell it (that not my case, because I moved one year ago) and re-invest in less than 2 years in your main home.
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Non, the Goverment Web is fine, It explain what is a doble tax treat and what it's not when you claim it and when not. Selling a house in Uk when you are non resident is not under doble taxation in Uk because you have to declare and pay first in Uk. You could claim the doble taxation relief in France or the country where you have your fiscal residence in EU.

It works the same in any country, I now well the law. You have to declare first always where the possession is (house, dividens, accounts...) and then claim the doble treat in the country where you declare your world income.

Make sense??
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Lindal wrote:

"HMRC communicate with French impots now on things such as this so you need to be careful. (I know from personal experience!) "

Not for much longer. LOL

If you are hoping brexit will change this then you are mistaken. Communications with HMRC and other countries are on a country by country basis and are not connected to EU law..and neither is the double taxation treaty.

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  • 5 months later...
We are thinking of selling our UK property that we've owned for 17 years but have never lived in; it's been rented out all that time.

Because the £ has crashed against the € the capital gain will not be huge.  Does anyone have an idiot's guide to the sort of %ages payable in the UK and France?

Thanks.

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[quote user="Zelanda"]Hi all,

We are in the stressfull proccess of selling our former home in Uk, as we are living in France.

I've been reading the French impots gov web and the rules for calculate tax gain are so complicated that I'm getting mad!

So I have some cuestions that maybe some of you can clarify.

- How I calculate the gain in € ? Should I take the Pound value at the day we bougth the house (less expenses) Vs the pound value at the day we sell (less expenses)? Because if, the gain in € would be a lot less than in pounds.

- Can I deduct the 7.5% in buying charges and expenses as standard, even if the fees and taxes I paid in Uk were less than that, or Should I count the amound I really paid in pounds?

-Can I deduct too the 15% as standard in improvements, because I owned the property for more than 5 years? even if I didn't expend that amoung?

- Can I have the exception if with the gains I buy a house here in France for living?

It would be very very grateful if anyone could answer those cuestions, because I have no idea how much coulld we pay in French taxes.

Regards,[/quote]

Hi,
   You certainly should use the € value (on the day of purchase) for the purchase price ; and the € value (on the day of sale) for your calculation .    You should also claim the 15% and 7.5% (€ on day of purchase )- which you add to the purchase price  thus reducing the ultimate  gain.
  As for the exception for purchase of a pricipal residence in France , I don't know - you may need to ask the tax office to get  reliable  advice.

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