The UK tax system has undergone significant changes in recent years, particularly in relation to the treatment of Capital Gains Tax (CGT) on residential property disposals.
The introduction of the 60 Day CGT Return has left many property owners feeling overwhelmed and unsure of how to proceed.
Many clients come to us after receiving a prompt letter from HMRC and were not previously aware of the requirement.
In this article, we will provide a comprehensive guide to the 60 Day CGT (Capital Gains Tax) Return on disposal of residential UK Investment Property or a Buy-To-Let, highlighting the importance of timely and accurate reporting to HMRC.
ESDG Accountancy is here to help you submit your CGT return for a fixed fee quote – providing you an accurately calculation which maximises all expenses and reliefs available.
What is Capital Gains Tax (CGT)?
Capital Gains Tax (CGT) is a tax charged on the profit you make when selling an asset that has increased in value, such as a residential property. The amount of CGT tax you pay depends on several factors, including the property’s value, the length of time you have owned it, allowable tax reliefs, your current tax band, and whether it is your primary residence.
Contact us now to find out how we can help!
Get a fixed fee quote for your capital gains tax calculation & 60 day CGT return submission.
Our professional service will ensure your claim all available tax deductions and expenses so you don’t pay a penny more tax than you are legally required to.
See our related article for further information: Capital Gains Tax on an Investment Property Sale – A Guide
What is the 60 Day CGT Return?
The 60 Day CGT Return is a requirement introduced by HMRC for individuals who dispose of a residential property on or after 6th April 2020. Property owners are now required to report their capital gains and pay any CGT tax due within 60 days of the disposal. This new deadline is a significant change from the previous system, where taxpayers reported capital gains on their annual Self Assessment tax return, often giving them up to 22 months to settle their tax liability.
Is the 60 Day CGT Return always required?
If you have sold an investment property, buy-to-let property, holiday home, or a property which has ever been rented out (even if you lived in it for a length of time) then you maybe in scope of the requirement to file a CGT return within the 60 day window.
There is not a 60-day reporting requirement where no tax is due. Examples may include;
- A trivial gain where any profits are covered by Annual Exemption or PPR (Private Residence Relief).
- A transfer to a Spouse.
- The property has been sold for a loss.
Why is the 60 Day CGT Return Important?
The 60 Day CGT Tax Return is crucial for property owners because it ensures that all capital gains are accurately reported and tax liabilities are settled promptly. Failing to submit a return within the 60-day window can result in substantial penalties and interest charges, with potential damage to your credit rating and future borrowing capabilities. Many clients come to us not previously knowing they needed to submit a return, only doing so after receiving a prompt letter from HMRC.
How Can ESDG Accountancy Help You?
Our expert accountancy team specializes in providing professional advice and support for clients dealing with 60 Day CGT Returns.
We can calculate the tax due for your property sale and submit all necessary forms to HMRC. We proactively look to minimise your tax bill and ensure you claim all expenses and reliefs available.
Our services include:
- Comprehensive Capital Gains Tax Calculation: We will review your property disposal and calculate your potential capital gains tax liability, taking into account all relevant exemptions, reliefs, and deductions.
- 60 Day CGT Return Preparation: Our team will meticulously prepare and submit your 60 Day CGT Return to HMRC, ensuring accuracy and compliance with all reporting requirements.
- Tax Planning: We will advise you on any possible strategies to minimize your future CGT liability and optimise your tax position, such as utilising your annual tax-free allowance, claiming Private Residence Relief where appropriate, or transferring a share to your Spouse.
- Ongoing Professional Support: A Chartered Accountant will be available to answer any questions or concerns you may have throughout the process, providing you with peace of mind and confidence in your financial affairs. We will ensure you understand the calculation and how you can pay any tax due, as well as any deadlines you need to be aware of.
Conclusion
Without engaging an accountant, accurately and successfully submitting your 60 Day CGT Return can be challenging. You run the risk of error – leading to losing out on tax relief available if your calculation is overstated, or HMRC penalties if your calculation is understated.
ESDG Accountancy is here to guide you every step of the way and we can make the process seamless for you – having completing many of these returns before. We can offer fast turn-around times and a fully comprehensive, straight-talking service.
Contact us today to discuss your property disposal and let us help you take control of your capital gains tax obligations.
