As announced in the Autumn budget, any capital gains tax liability arising on the sale of UK residential property will now need to be paid within 60 days of the date of completion of a sale. This became effective immediately and applies to completions taking place on or after 27th October 2021.
Previously if buy-to-let property owners and second homeowners were to sell a residential property that resulted in capital gains tax (CGT) being due, this needed to be reported and paid to HMRC within 30 days of sale.
The 30-day deadline was a drastic change when brought in on 6 April 2020, as previously you simply reported the gain within the relevant Self Assessment return, with tax due by 31 January following the end of that tax year.
This change therefore gives a much better timescale to gather all the required information and complete any forms for HMRC’s reporting requirements. Particularly as such things can only be calculated once the sale has been completed and fees incurred for instance.
Reporting a Gain
For those with accountants, they should be able to take care of any reporting requirements, as agent on someone’s behalf.
To report a gain yourself, you would need to register on the Government Gateway for capital gains tax. This provides the facility to report and pay any capital gains tax. Please note, late filing penalties apply if a gain is not reported within the 60-day time frame.
You would also need to report the gain on the relevant Self Assessment, as would have been the case previously. After this, any under/over payments of capital gains tax will be settled, ensuring the overall capital gains tax position for the year is correct.