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Emigration charge on non-resident trusts

Where UK resident trustees become non-resident, for example due to the resignation of UK resident trustees who are replaced by non-resident trustees, they are deemed to have disposed of all the assets held in the trust at the time of emigration and to have reacquired them at their market value¹. If this deemed disposal gives rise to a capital gain then, immediately before the trustees cease to be resident, they are chargeable to a CGT emigration, or 'exit', charge on that gain.

Trust assets are subject to the exit charge unless they:

1. Ìý

   •ÌýÌýÌýÌý continue to be used for the purposes of a trade carried on by the trustees in the UK through a branch or agency² or, in the case of corporate trustees, through a permanent establishment³, or

2. Ìý

   •ÌýÌýÌýÌý are exempt from CGT under a double taxation agreement⁴

A similar charge arises where trustees remain UK resident but are also treated as resident in another country by virtue