A former remittance basis user who sells a foreign asset on or after 6 April 2025 can usually compute the capital gain as if they had bought it on 5 April 2017 at its market value that day. The relief is in Schedule 11 to the Finance Act 2025 and applies only if the person held the asset on 5 April 2017, kept it outside the UK from 6 March 2024 to 5 April 2025, was never UK domiciled or deemed domiciled before 2025 to 2026, and claimed the remittance basis for at least one year from 2017 to 2018 onwards.

Why does this rebasing exist?

From 6 April 2025 the remittance basis was abolished and all UK residents are taxed on the arising basis (RDRM30005). Someone who used the remittance basis may hold foreign assets with large gains built up while those gains would only have been taxed if remitted. Section 42 of the Finance Act 2025 introduces Schedule 11, which lets qualifying individuals reset the base cost of those assets to their value at 5 April 2017, so that only growth after that date is taxed when they sell.

The rule works automatically if the conditions are met. There is an election to switch it off, covered below. It changes only the capital gains computation; it does not change the rules on remitting pre 2025 foreign income and gains, for which see mixed funds and remittances after April 2025.

Who qualifies?

Paragraph 1(1) of Schedule 11 sets conditions about the person:

  • Never UK domiciled before 2025 to 2026. The individual must not have been domiciled in the UK at any time in a tax year before 2025 to 2026, and deemed domicile under section 835BA ITA 2007 counts (paragraph 1(5)). Anyone who became deemed domiciled under the 15 out of 20 year rule before April 2025 is excluded, as is anyone born in the UK with a UK domicile of origin who was deemed domiciled while resident. See is domicile still relevant for UK tax.
  • A remittance basis claim in the right years. The individual must have made a claim under section 809B ITA 2007 for at least one tax year from 2017 to 2018 to 2024 to 2025, and it must be a year in which the remittance basis did not apply automatically under sections 809D or 809E.

That second condition is narrower than the test for the temporary repatriation facility, which counts years where the remittance basis applied without a claim (RDRM73200). Someone whose only remittance basis years were small unremitted amounts under £2,000 may be able to use the facility but not rebasing.

The rule applies to disposals by the individual. Assets held by trustees or companies are outside it, and the individual must personally have held the asset on 5 April 2017.

Which assets qualify?

The asset must have been held on 5 April 2017, be disposed of on or after 6 April 2025, and not have been situated in the UK at any time from 6 March 2024 to 5 April 2025 (paragraph 1(1)(a) to (c)). Where shares have been through a reorganisation treated under section 127 TCGA 1992, the UK situs test applies to both the original and the new holding.

Paragraph 2 ignores some UK presence during that window, following remittance basis concepts:

  • works of art and similar items brought in for public access or repair under sections 809Z and 809Z3 ITA 2007;
  • items in the UK solely or mainly to be sold or offered for sale;
  • clothing, footwear, jewellery or a watch for the personal use of the individual, their spouse or civil partner, or their children or grandchildren under 18;
  • property with a notional remitted amount under £1,000, and property still within the temporary importation rule in section 809Z4.

Anything else that was in the UK even briefly during the window loses rebasing, for example a painting hung at a London home in 2024.

How does it interact with gifts to a spouse?

Paragraph 1(3) says the rebasing assumption applies notwithstanding section 58(1) TCGA 1992, the rule that treats transfers between spouses and civil partners as giving neither gain nor loss. Because the asset must have been held by the person making the disposal on 5 April 2017, check carefully which spouse owned it at that date before planning a transfer.

Can you choose not to rebase?

Yes. Paragraph 3 lets the individual elect for rebasing not to apply to a particular disposal. The election is irrevocable and follows the claims procedure in sections 42 and 43 TMA 1970, so it must be made within 4 years after the end of the tax year of the disposal (section 43(1)). For a disposal in 2026 to 2027 that means by 5 April 2031. The election is made disposal by disposal, so it can be used on one asset and not another.

You would elect out where the asset was worth less on 5 April 2017 than you paid for it, because rebasing would then increase the gain or reduce a loss.

What does it look like in practice?

Illustration only. Lena claimed the remittance basis for 2018 to 2019 and was never deemed domiciled. She bought shares in a foreign listed company in 2012 for £100,000, held in an overseas account. They were worth £250,000 on 5 April 2017. She sells them in May 2026 for £400,000 as a higher rate taxpayer.

With rebasing Without rebasing
Proceeds £400,000 £400,000
Cost £250,000 £100,000
Gain £150,000 £300,000
Less annual exempt amount 2026 to 2027 £3,000 £3,000
Tax at 24% £35,280 £71,280

Now suppose another holding cost £300,000 in 2015, was worth £200,000 on 5 April 2017 and sells for £350,000. Rebasing gives a gain of £150,000 against an actual gain of £50,000, so Lena should elect out for that disposal. The rates and exempt amount are those for 2026 to 2027 (see capital gains tax rates).

Does rebasing change what happens to the sale proceeds?

No. Rebasing applies for computing the gain under TCGA 1992 (paragraph 1(2)). If the asset was bought with untaxed foreign income or gains from remittance basis years, the asset and its sale proceeds are still treated as containing that income or those gains for remittance purposes (RDRM35420). Bringing the proceeds to the UK can therefore still trigger tax on the old income unless it has been designated under the temporary repatriation facility. The new post 2025 gain itself is taxed as it arises, so it is not taxed again when remitted.

How is this different from the 2017 rebasing?

An earlier rebasing in Schedule 8 to the Finance (No. 2) Act 2017 applied to people who became deemed domiciled under the 15 year rule from 6 April 2017, using a different UK situs window ending on 5 April 2017 (CG25302). Paragraph 4 of the 2025 Schedule amends that older rule so its test years run only up to 2024 to 2025. Check which regime applies before using any 2017 valuation.

What mistakes come up most often?

  • Assuming every former non dom qualifies. Years where the remittance basis applied automatically do not count, and any deemed domicile before 2025 to 2026 rules the person out.
  • Missing a short UK visit by the asset between 6 March 2024 and 5 April 2025.
  • Failing to obtain and keep a supportable 5 April 2017 valuation, especially for unquoted shares and property.
  • Forgetting the election when rebasing increases the gain.
  • Confusing rebasing with the four year foreign income and gains regime, which is for new arrivals and works by claim.

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Reviewed by Christine Anderson, Broker, Solar Protect. Last reviewed 19 October 2026. Part of Accountapedia, the Solar Protect guide to UK tax and accounting. This page is general information, not personalised advice.