Readers' forum : New world

28 March 2017

Issue: 4593 / Categories: Forum & Feedback

Liability on foreign investment income transferred to an overseas company.

Our client is Colombian but has been UK resident for more than 35 years. She owns property and investments in Colombia and the income arising has been declared in her UK tax returns (it was not beneficial to claim remittance basis).

In 2015-16 our client’s Colombian advisers transferred the properties and investments at market value to an SAS (simplified joint stock company) in exchange for a share. We have been advised that this is fiscally neutral in Colombia and no tax liability arises there. However for UK capital gains tax purposes we believe this is treated as a disposal at market value and our client has a UK tax liability of about £9 000 based on the increase over cost. Do Taxation readers agree with our assessment and is there any other information we should be aware of?

Query 18 951 – MS.

Reply by ANA

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