Taxation of Chargeable Gains Act 1992 Schedule 4ZZB paragraphs 2–3

Calculating the amount of gains and losses for returning non-UK residents

Schedule 4ZZB paragraphs 2 and 3 set out how to calculate the chargeable gains and allowable losses on assets held by individuals who return to the UK after a period of temporary non-residence, specifically addressing assets acquired before departure and those acquired during the period abroad.

• Where an asset was held before the individual left the UK and is disposed of during the temporary non-residence period, the gain or loss is calculated by reference to the market value of the asset at the date of departure from the UK, rather than its original acquisition cost.
• Any gain or loss that accrued during the period of actual UK residence (i.e. before departure) is excluded from the charge that applies on return, so that only the portion of gain arising during the non-resident period is brought back into charge.
• For assets acquired during the period of temporary non-residence, the full gain or loss on disposal is brought into charge on the individual's return to the UK, as the entire holding period falls within the non-resident window.
• These rules were introduced by Finance Act 2019 Schedule 1 paragraph 19 and apply to ensure that individuals cannot exploit a temporary period abroad to realise gains on pre-existing assets free of UK capital gains tax.