Newsletter Autumn 2019

Pay tax on gains in 30 days

When non-resident owners sell UK land or property (of any type), they must pay any Capital Gains Tax (CGT) within 30 days of the completion date of the sale, and submit an online report to HMRC by the same date.

This 30-day payment deadline is being rolled out to all UK owners of residential property for sales made on or after 6 April 2020.

From that date, if you make a gain on selling a home, any CGT due will have to be paid in full within 30 days. You will need to estimate whether or not you will be a higher-rate taxpayer for the tax year, in which case the CGT is due at 28%, otherwise at least some of the CGT is charged at 18%. However, those tax rates could be changed before April 2020.

This is a massive acceleration on the current payment date for CGT, which is currently 31 January after the end of the tax year in which the property was sold.

Say you sell your buy-to-let property on 1 October 2019, the CGT will be payable by 31 January 2021. If you wait until 1 May 2020 to sell the same property, the CGT will be payable by 31 May 2020.

We will need to know about your property sales as soon as they are agreed, so we can help you calculate the tax due and submit the property disposal return to HMRC within 30 days of the completion date.

You will also have to report the capital gain on your self-assessment tax return after the end of the tax year, and at that stage you may be due a refund of CGT if you have made any other disposals generating capital losses in the year.