Capital Gains Tax 60-day Reporting UK Residential

Simon Misiewicz

Expat & Property Tax Specialist

3rd March 2022

Capital Gains Tax Reporting To HMRC within 60 days of selling a residential property

UK Landlords who have sold a residential property and made a taxable gain will need to report this to HMRC. We advise clients to report any capital gains tax on residential property to HMRC even if no gain is made. This ensures that all reports are filed and evidence given to HMRC to limit future enquiries on any disposals made.

The number of days to report a capital gain is 60 days of selling the property if the completion date was on or after 27th October 2021. Reporting a capital gain to HMRC was 30 days between 6th April 2020 and 26th October 2021.

Please note that you may wish to learn how the capital gains tax liability may be reduced when selling a UK property. It is possible to mitigate CGT on a residential property disposal.

Ensure you report and pay Capital Gains Tax (CGT) on UK residential property to HMRC within the required timescales to avoid later filing penalties.

How do I complete an HMRC UK Taxable Capital Gains Tax return? 

Reporting and paying Capital Gains Tax on UK residential property to HMRC is relatively straightforward.

Once you have worked out your UK taxable capital gain, you need to report them to HMRC if they are above your Capital Gains Tax allowance.

Reporting Capital Gains Tax (CGT) on a residential property disposal can be reported to HMRC in two ways:

– Instantly via HMRC’s real-time CGT service online

– Annually, in a Self-Assessment tax return, if done within 60 days of the residential property disposal property.

If you opt to complete a Self-Assessment tax return, you must register with HMRC.

You can schedule a Capital Tax Gains consultation with one of our property accountants to assist you with reporting your Capital Gains Tax return to HMRC. We can check the tax calculations and ensure the HMRC return has been done correctly.

Avoiding CGT late filing penalties and payment penalties - report and pay Capital Gains Tax on UK residential property on time

CGT rules change often. Knowing how and when to report capital gains tax correctly is essential.

There are different ways to report UK residential properties sold since 6th April 2020. Likewise, there are various ways to report UK residential property sold before 6th April 2020, namely the self-assessment tax return that must be filed by 31st January each year.

You will need to make a taxable capital gains tax computation for each gain or loss you report. Here is where you’ll find that accurate record keeping is your best ally. You can also use our CGT calculator to identify the tax liabilities in some instances.

There are many elements of detail that you will need to obtain when submitting the CGT computation to HMRC within 60 days of the disposal:

– Date of original purchase and sale of an asset
– Capital purchase costs and legal fees associated
– Sales price less any agency and legal fees
– Capitalised costs during the holding period of the asset

Complying with the 30-day reporting rule when selling UK residential property is essential. If you fail to do so, you may find that you’re subject to penalties and interest.

Ensure you report and pay Capital Gains Tax on UK residential property on time by working with your property accountant.

If you are a non-resident and sell a UK residential property, you must still report the asset disposal within 60 days. This HMRC 60 day CGT reporting rule applies to non-residents even if you do not owe capital gains tax.

What if the HMRC 60 day reporting Capital Gains Tax was incorrect? Use a capital gains tax accountant

You should have all the relevant information when you sell a residential buy to let property when submitting your CGT 60-day report. However, more information may arise when submitting your self-assessment tax return.

You will have more tax to pay on 31st January if it is found that you owe more CGT to HMRC than you initially disclosed and settled in the 60-day report.

Equally, you will likely get a tax credit on your self-assessment tax return if you have overpaid CGT to HMRC on the Capital Gains Tax reporting 60-day process.

You should report and pay Capital Gains Tax on UK residential property to HMRC simultaneously.

Reporting CGT for asset disposals for non-residents to HMRC

HMRC state that you must report the disposal online using the non-resident Capital Gains Tax return by the 60-day deadline, even if:

– you’ve no tax to pay

– you’ve made a loss

– you’re registered for Self Assessment

UK taxable capital gains tax is charged on a residential property disposal directly or indirectly owned by non-UK resident individuals. “Non-resident” includes the overseas part of a split-year. Such disposal is referred to as a Non-Resident CGT (“NRCGT”) disposal (TCGA 1992, s.14B).

Direct ownership means they own the asset (or a portion of it) in their name. Indirect ownership means they own shares in a company that owns such assets.

UK residential property means a dwelling either used as a residence or suitable for use and is outside the charge were sold before 5th April 2015. Commercial property capital gains are outside the charge and were made before 6th April 2019.

If there was a change of use of the property (or if the property was in mixed residential and non-residential use), a “fair and reasonable apportionment” of the gain could be made to reflect any time the property was not residential (TCGA 1992, Sch.4ZZB para 6) up to 6th April 2019.

In summary:

– On UK residential property, the part of the gain arising after 5th April 2015 is chargeable to CGT (as this was the date the legislation took effect for residential property). Similarly, only the post-April 2015 element of a capital loss is allowable.

– On UK commercial property, the part of the gain arising after 5th April 2019 is chargeable to CGT (as this was the date the legislation took effect for commercial property). Similarly, only the post-April 2019 element of a capital loss is allowable.

Two HMRC rates for Capital Gains Tax

It is important to note that there are two rates of CGT on a Capital Gains Tax return.

– A residential property will be subject to:

– – 18% for basic rate taxpayers and

– – 28% for high rate taxpayers

– A non-residential (commercial) property will be subject to

– – 10% for basic rate taxpayers and

– – 20% for high rate taxpayers

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