Reporting Capital Gains on residential property

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The Capital Gains Tax (CGT) reporting and payment date for UK residents that sell a residential property changed from 6 April 2020. This change means that any CGT due on the sale of a residential property needs to be reported and a payment on account of any CGT due made within 30 days of the completion of the transaction. This needs to be done online via the Government Gateway, so if you need to report a gain you should create a user ID and password (if you don’t already have one) and then register for “Capital Gains on UK Property”. You will need to do this, even if you plan to ask your accountant to file the CGT return on your behalf. The normal agent authorisation to file your annual tax returns doesn’t cover this new service.

In practice, this change will only apply to the sale of any residential property that does not qualify for Private Residence Relief (PRR). The PRR relief applies to qualifying residential property used wholly as a main family residence.

HMRC has listed the following types of property sales that are affected:

  • a property that you have not used as your main home;
  • a holiday home;
  • a property which you let out for people to live in;
  • a property that you have inherited and have not used as your main home.

This new reporting requirement does not apply to sales of your home if the private residence relief was available for the period of your occupation. There can be penalties and interest if you do not report gains within 30 days or the CGT due is paid late. Note, the payment date for any CGT due on residential property sales made in the year to 5 April 2020 is 31 January 2021.

There were also changes to the PRR rules which saw the final exempt period for CGT purposes being reduced from 18 months to 9 months Рfrom 6 April 2020. This relief applies even if the homeowner was not living in the property when it was sold. The time period can be extended to 36 months under certain limited circumstances.

Useful information for Reporting Capital Gains on residential property

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