Tax Planning
Planning for Non-Resident Capital Gains: UK Rules Taking Effect April 2026
New UK rules for non-resident capital gains are coming into force from April 2026—this article explains what you need to know and how to prepare if you own UK property or investments.
By NomadicTax Research Team • 5-8 min read • February 18, 2026
## What Are Non-Resident Capital Gains and What’s Changing?
From 1 April 2026 (companies) and 6 April 2026 (individuals), the UK is implementing several revised rules affecting how non-residents are taxed on capital gains arising from UK property and other UK assets. These changes, announced in Budget 2025 and now moving toward legislative enactment, include updates to the definition of "property-rich" entities, amendments to protections for foreign investors, and clarifications to administrative requirements. ([gov.uk](https://www.gov.uk/government/publications/budget-2025-overview-of-tax-legislation-and-rates-ootlar/budget-2025-overview-of-tax-legislation-and-rates-ootlar?utm_source=openai))
### Key Elements of the Changes
- **Revised definition of a "property-rich entity"**: Certain companies and trusts whose value is substantially derived from UK property will be subject to UK capital gains tax (CGT) as if they owned the property directly. The new rules refine which entities qualify. ([gov.uk](https://www.gov.uk/government/publications/budget-2025-overview-of-tax-legislation-and-rates-ootlar/budget-2025-overview-of-tax-legislation-and-rates-ootlar?utm_source=openai))
- **Abolition of non-resident dividend tax credit**: From 6 April 2026, non-resident individuals will no longer benefit from notional UK tax treated as having been paid on dividends received from UK companies. This may increase tax liability for some foreign shareholders. ([gov.uk](https://www.gov.uk/government/publications/budget-2025-overview-of-tax-legislation-and-rates-ootlar/budget-2025-overview-of-tax-legislation-and-rates-ootlar?utm_source=openai))
- **Administrative and reporting changes for affected entities**: The update obligates entities to comply with new reporting schedules, make adjustments to tax codes, and potentially revise historic claims to relief under ATED for qualifying commercial purposes. ([gov.uk](https://www.gov.uk/government/publications/budget-2025-overview-of-tax-legislation-and-rates-ootlar/budget-2025-overview-of-tax-legislation-and-rates-ootlar?utm_source=openai))
## Examples & Who Is Affected
| Scenario | Impact |
|---|---|
| A foreign company holding UK property through a property-rich vehicle | Could face CGT on sales or disposals from 1 April 2026, depending on structure. |
| A non-UK individual receiving dividends from UK companies | May lose dividend tax credit, increasing their tax on those dividends. |
| Trust holding UK property assets | May trigger property-rich entity test and be treated similarly to companies under new rules. |
## Actionable Steps for Tax-Planning
1. **Review existing entity structures**
- Assess whether your company or trust might now qualify as “property-rich” under the updated definition. Consider whether restructuring is possible (e.g. changes in holdings or ownership) to avoid surprise exposures.
2. **Dividend strategy adjustments**
- If you receive UK dividends as a non-resident individual, recalculate after considering loss of the dividend tax credit. For tax treaties, check whether they provide reliefs.
3. **Make use of reliefs or existing exemptions before dates change**
- If you have transactions planned before 6 April 2026, consider acting before this date to benefit from existing rules.
4. **Improve compliance and record-keeping**
- Ensure you understand reporting obligations and retain documentation required by HMRC. Engage UK-based tax advisers if needed.
5. **Monitor legislation progress**
- These changes are announced in Budget documents and are moving through the Finance Bill 2025-26. Final legislation may add clarity or adjustments. ([gov.uk](https://www.gov.uk/government/publications/budget-2025-overview-of-tax-legislation-and-rates-ootlar/budget-2025-overview-of-tax-legislation-and-rates-ootlar?utm_source=openai))
## Bottom Line
For non-UK residents, the tax landscape in the UK will shift in significant ways from April 2026, especially around capital gains, dividends, and entity definitions. Advance planning, restructuring, and keeping up with legislative details will be vital to avoid unexpected tax liabilities.