Non-resident capital gains tax depends heavily on the country and type of asset, but generally, the U.S. taxes non-residents on U.S.-source gains, often at a 30% flat rate (or treaty rate) for gains from U.S. property (FIRPTA) or certain other U.S.-sourced assets if present for 183+ days, while many other countries exempt most gains for non-residents unless they're on local real estate. Key factors are U.S. presence (183+ days), source of income (U.S. real estate is always taxable), tax treaties, and specific asset sales (like U.S. real estate, subject to FIRPTA withholding).
Yes, a foreign person or citizen is responsible for paying capital gains tax on U.S. property, i.e., real estate, even if they are a nonresident.
An NRI can claim 30% standard deduction on rental income and deduction of municipal taxes paid. Capital gains tax - NRI capital gains are taxable at 12.5% or 20% slab rates (plus applicable surcharge and cess), depending upon the nature of the capital asset and period of holding.
Second homes that are not used as primary residences, including vacation homes and investment properties, are considered to be capital assets under IRS rules. That means if you don't pass both the ownership and use tests for the property, as mentioned earlier, then no capital gains tax exclusion is allowed.
The "90-day rule" for non-residents typically refers to two different concepts: in U.S. immigration, it's a guideline for determining if a non-immigrant misrepresented their intent by engaging in certain activities (like unauthorized work or immediate marriage) within 90 days of arrival, leading to visa fraud or inadmissibility. In Canadian tax law, the 90% rule allows non-residents to claim full federal tax credits if 90% or more of their world income is from Canadian sources, otherwise, credits are prorated.
The full 50% CGT discount is generally not available to foreign and temporary residents for assets acquired after 8 May 2012. However, an apportioned discount may be available if you had a period of Australian residency before you became a foreign resident.
Who is considered a temporary non-resident? Individuals that leave the UK for fewer than 5 years (periods of 12 months, not tax years), and prior to leaving have lived in the UK for at least 4 out of 7 of the most recent years, can be treated as being a 'temporary non-resident' upon returning to the UK.
From 6 April 2020 you need to report and pay your non-resident Capital Gains Tax (CGT) and submit a non-resident Capital Gains Tax return if you've sold or disposed of: residential UK property or land (land for these purposes also includes any buildings on the land) non-residential UK property or land.
The "6-year rule" for Capital Gains Tax (CGT) in Australia allows you to treat a former main residence as tax-exempt for up to six years after you move out, even if you rent it out, enabling you to avoid CGT on any growth during that period. You qualify by moving out, choosing to treat it as your main home for tax, and can reset the rule by moving back in. If you rent it out for longer than six years, only the portion of the gain after the six-year mark becomes taxable.
To qualify for 0% capital gains tax, you must have long-term capital gains (assets held over a year) and your taxable income (after deductions) must fall below specific IRS thresholds, which change annually but are roughly <$48,350 for single filers and <$96,700 for married filing jointly for the 2025 tax year, allowing for higher total income when combined with deductions like the standard deduction. The key is keeping your adjusted gross income (AGI) low enough so that after subtracting deductions, your taxable income remains within these limits.
If you're not tax resident in Ireland and you're selling Irish property, you'll need Non-Resident CGT Clearance from Revenue before your solicitor can release your sale proceeds. This clearance ensures any Capital Gains Tax (CGT) due is properly paid. Without it, your solicitor cannot legally release the funds.
Many entrepreneurs search for jurisdictions where company profits can grow untaxed until they are actually paid out. Countries such as the United Arab Emirates, Singapore or the Cayman Islands are often listed as “no-capital-gains-tax jurisdictions”.
However, the benefit of indexation is not available to a non- resident where following conditions are satisfied:1[1] (i) A non-resident transfers a capital asset being : • shares in an Indian company, or • debentures of an Indian company.
Income from Capital Gains
The buyer shall deduct TDS at 12.5% when he purchases a property from non-resident. However, you can claim capital gains exemption by investing in a house property as per Section 54 or investing in capital gain bonds as per Section 54EC.
Non-residents are generally taxed only on their Australian income and are subject to CGT if the capital gain was derived from taxable Australian property, such as real estate.
Special Rules for When Foreigners Sell US Property
Under the Foreign Investment Real Property Tax Act (FIRPTA), when a US non-resident sells real property, 15% of the gross sale price will automatically be withheld for the IRS.
On a $100,000 capital gain, you'll likely pay 15% for long-term gains, resulting in about $15,000 in federal tax (plus potential state tax), but it could be 0% or 20% depending on your total taxable income and filing status, while short-term gains are taxed as ordinary income (potentially 22-24%).
Qualifying for the exclusion
You're eligible for the exclusion if you have owned and used your home as your main home for a period aggregating at least two years out of the five years prior to its date of sale. You can meet the ownership and use tests during different 2-year periods.
UK Property CGT applies to non-residents selling UK property or land, including both direct and indirect disposals. This means that if you sell shares in a company that derives its value from UK land or property, you may also be liable for UK CGT.
The simplest way to avoid capital gains tax is to regularly use your capital gains tax allowance (officially known as your annual exempt amount or AEA). How easy this is to do depends on the assets you are selling.
Capital gains income is not usually taxable for nonresidents who have been present in the U.S. for less than 183 days in a calendar year. However, it is taxable when the presence is 183 or more days.
No — not anymore. Under the pre-2020 rules, a property could retain its CGT-free status if sold within 6 years of moving out (or indefinitely if not rented). But now, if you're a foreign resident at the time of disposal, the 6-year rule provides no protection.
No preferential rates: Unlike federal taxes, California does not offer lower tax rates for long-term capital gains. Ordinary income tax rates apply: Capital gains are subject to the same progressive tax rates as regular income, which range from 1% to 13.3%