I hope somebody here can give me some pointers on this...
I am UK resident but non-domiciled.
In the tax years up to and including 2007-08 I claimed the remittance basis of taxation of offshore assets. From 2008-09 on I am opting for the arising basis.
In 2007 I sold a house in S America for about £90k, of which about £60k was a capital gain. I did not remit any of the funds from the house sale at the time so no UK CGT was paid. A small amount of South American CGT was paid.
In the 2009-10 tax year I will be remitting £30k of the funds from the sale, of which £20k will be capital gains.
My question is how do I work out my tax liability? As I understand it:
Since the gain arose in a remittance year (2007-08) I will be liable for tax on the remittance basis.
I will therefore have £20k of capital gains to declare on my 2009-10 tax return (Foreign pages).
I can offset my CGT allowance against this ? presumably my 2009-10 CGT allowance not my 2007-08 allowance? (I have not used either for anything else.)
I can also offset the CGT paid in South America.
I would then be liable for 18% CGT on the remainder of the gain.
Is that correct? Or have I misunderstood?
Many thanks for any replies.