Are there any taxes to be paid to HMRC when I sell an inherited property in another country?

Question

I recently (less than six months ago) inherited a flat in Italy. I'd like to sell it. Are there any taxes to be paid to HMRC if I have the money being paid to a UK bank account?

Answer 1

The taxes you might owe are independent of whether you transfer the proceeds to a UK bank account (unless you are a so-called "non-dom" claiming the remittance basis, in which case this answer doesn't apply).

You are liable to Capital Gains Tax at the point of sale. However, it's likely that your gain will be minimal given that you've owned it less than 6 months and property prices are not booming at the moment. So the gain may well come under the annual allowance (£12K until April 5th, then £6K for the next year and finally 3K from April 6th 2024). You will need to work out this gain to check if you have any tax to pay.

Separate to any tax issues, note that having owned this property, you will not count as a "first-time buyer" for the purpose of various UK tax schemes, even after selling the property. See for example the stamp duty rules.