Don’t get caught out by CGT reporting
The UK housing market still appears to be buoyant, with Rightmove reporting that homeowners are continuing to take advantage of record asking prices to sell their properties. The company says that the number of requests from prospective sellers for an estate agent to come out and value their home is at its highest level since the start of the year.
Rightmove revealed that Wednesday 22 June was the fourth busiest day on record for requests to estate agents to value a home, and the highest single day for valuation requests since May 2021.
With the market being so busy, it’s not surprising that, here at Lewis & Co, we’ve had an influx of clients asking for our advice surrounding capital gains tax (CGT) reporting following the disposal of a residential property. In addition, people have approached us for help because they’ve fallen foul of the new rules.
The Government introduced reporting requirements for UK residents disposing of residential property on or after 6 April 2020. From this date, taxpayers were required to report any disposals of UK residential property and pay their estimated CGT liability. Between 6 April 2020 and 26 October 2021, taxpayers were required report and pay within 30 days of the completion date. However, for completions on or after 27 October 2021, the time limit was increased to 60 days, as announced at the Autumn Budget 2021.
That said, you may only have to pay CGT if you make a profit when you sell property that’s not your main residence, which typically includes buy-to-let properties, land or inherited property. In most cases, you do not need to pay the tax when you sell your main home.
Where CGT is due on the disposal of UK residential property by a UK resident individual, partnership or trustees, a new standalone online return will need to be filed, together with payment on account of CGT, within 60 days of the date of completion of the transaction.
It is likely that you may have to pay interest and a penalty, if you do not report gains on property within the time limit.
If you’ve got any questions or need any help, please call our team on: 01892 513515 or email: info@lewisandco.biz