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The short answer
If you leave the UK after being solely UK resident in at least 4 of the 7 tax years before you went, and come back within 5 years, you are a temporary non-resident. Gains you made while away on assets you owned before leaving are then taxed in the UK in the tax year you return, along with some types of income, such as certain pension withdrawals and some company distributions. Assets bought and sold while you were away are generally outside the rule.
Plenty of Nigerians who move home do not burn their bridges. A child's university place, a parent's health or a job offer can bring them back to London or Manchester within a few years. That possibility matters for tax, because the UK has a rule designed to stop people leaving briefly to sell assets free of UK tax and then returning.
Who counts as a temporary non-resident
HMRC's helpsheet HS278 (2026) gives three conditions. You are caught if:
- you had sole UK residence for the whole or part of at least 4 of the 7 tax years before the year you left;
- you then had a period that was not sole UK residence, between two periods of sole UK residence; and
- the total of that period away did not exceed 5 years.
Split years matter: HS278 notes that the period away can start or end part-way through a tax year where split year treatment applies. See split year cases on leaving.
What gets taxed on return
Gains
Gains from disposals made while you were away are treated as arising in the tax year you come back. HS278's first example is a £35,000 gain realised by someone who left in 2021 and returned in 2026; it is charged in the year of return. Losses made in the period away are treated the same way and become allowable in the return year. The remittance basis cannot be used, as it ended on 6 April 2025.
The main exception: gains on assets you acquired after leaving are generally outside the rule. HS278's example is shares bought in 2021 and sold the following year, a £12,000 gain that is not treated as arising in the year of return. That exception does not apply where the new asset came from a no gain/no loss transfer (such as from a spouse), where its cost was reduced by rollover relief, or where it carries a deferred gain from before you left.
Income
HS278 lists income received while away that is treated as arising in the year of return. It includes:
- flexible drawdown withdrawals and some pension lump sums, including certain UK lump sums where a treaty removed the charge on receipt;
- distributions from close companies, though those paid out of trade profits arising during the period away are not taxable;
- remitted relevant foreign income, released or written-off loans to close company participators, life insurance gains (with time apportionment available) and offshore income gains.
For a director of a small UK company who moves to Nigeria and takes a large dividend while away, this is often the item that matters most.
A worked example
Example (illustrative): Tobi was UK resident from 2015-16 to 2026-27 and left for Abuja in April 2027. In 2028 she sold UK-listed shares she had held since 2018, making a £20,000 gain, and bought NGX shares that she sold in 2029 for a £6,000 gain. She returned to the UK in 2031, four years after leaving.
| Item | Acquired | Treatment on return in 2031-32 |
|---|---|---|
| £20,000 gain on UK shares | Before leaving | Treated as arising in 2031-32 and taxed then |
| £6,000 gain on NGX shares | After leaving, sold before return | Generally outside the rule |
| Nigerian tax paid on either sale | Credit may be available against the UK tax (HS263) |
Had Tobi stayed away more than five years, neither gain would be caught by this rule. Nigerian tax on gains made while resident there remains a Nigerian matter; see UK CGT on Nigerian shares for how the two systems interact on shares.
How the Nigerian side fits
While you live in Nigeria, Nigeria may tax gains on Nigerian assets and, if you are resident there, your worldwide income; see when Nigerian tax starts. Temporary non-residence does not change any of that. It simply adds a UK charge in the return year on top, which is why the credit for Nigerian tax already paid matters. A UK sale made while away can be taxed in the UK on return even though no UK tax was due at the time, so set aside money for it if a return is likely.
Double tax
If a gain was taxed in Nigeria when it was made and is taxed again in the UK in the year you return, HS278 says relief may be available and points to HS263, Relief for Foreign Tax Paid. Keep the Nigerian assessment and payment receipt, as you will need them years later.
Planning points before you leave
- Count your years of sole UK residence before departure: 4 of the previous 7 brings you into scope.
- List assets you will keep that may be sold while away, especially UK shares, funds and company holdings.
- If a return within five years is a real possibility, consider the timing of large disposals and dividends with an adviser.
- Keep records of departure and return dates and of any split year claim.
- For the inheritance tax tail that also follows leavers, see UK inheritance tax after 10 of 20 years.
Questions people ask
What is the 5-year rule for leaving the UK?
If you were solely UK resident in at least 4 of the 7 tax years before leaving and come back within 5 years, certain gains and income from your time away are taxed in the year you return.
Are shares I bought in Nigeria after leaving caught?
Generally not. HS278 says gains on assets acquired after leaving and disposed of while away are excluded, with limited exceptions.
Are dividends from my UK company taxed if I return within 5 years?
Some close company distributions received while away are taxed on return, but HS278 says those paid out of trade profits arising in the period away are not.
Is the 5 years counted in tax years?
HS278 says the period of non-sole-UK residence must not exceed 5 years in length; split years can make it start or end mid-year.
Sources
- HMRC HS278: Temporary non-residents and Capital Gains Tax (2026) · accessed Oct 2026
- HMRC HS263: Relief for foreign tax paid (2026) · accessed Oct 2026
- LITRG: Split year treatment, leaving the UK (updated 6 Apr 2026) · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.