Farewell 2019/20 CGT reporting, welcome 2020/21 new CGT reporting..!
Last tax year ended with a bit of a downer and the start of this one isn't looking much better in the short term. It's probably going to sort itself out in the next few weeks/months… We will all be back to hugging strangers and not washing hands as often as we should in no time at all.. probably..
Anyway, the new tax year heralded some new tax rules, as they tend to do. This article is about the changes to CGT reporting and payment changes.
From 6 April 2020, UK residents who dispose of UK residential property have 30 days from completion in which to report the disposal and pay the tax to HMRC. This doesn't apply if you are selling your property which has the benefit of full Private Residence Relief or any gains are within the annual exemption. Losses do not need to be reported in this way and nor do disposals between spouses or civil partners.
Non-UK residents have to notify of any disposals of UK property or land (residential or non-residential) regardless of whether there is tax to pay or have made a loss.
The reporting is done online and you will need to create a "Capital Gains Tax on UK property account" (catchy) via your Government Gateway account. If you use an agent, such as Gepp Solicitors (there had to be a sales pitch in here somewhere, right?), you will still need to create an account and pass the account number to your agent. We Your agent will then deal with the reporting for you via the online form.
You cannot use the online service if you are an executor or administrator of a deceased estate and HMRC's guidance currently says to call them for a paper version of the form.
You will still need to report the gains on your self-assessment tax return as normal and you'll need to pay any CGT shortfall on what was calculated before, for example you received more income in the year than expected which pushed more gain into the higher rate.
Gepp Solicitors have a dedicated tax team who can assist you with your HMRC reporting requirements and provide CGT advice, including tax mitigation planning. We do not use or recommend tax avoidance schemes, we just give quality advice tailored to your requirements.
If you need to report a disposal to HMRC, or are unsure if you need to, please feel free to contact our Private Client department on 01245 228125 or PrivateClientEnq@gepp.co.uk.
This is not legal advice; it is intended to provide information of general interest about current legal issues.