Don’t forget to notify HMRC of Capital Gains Tax arising from property sales within 30 days

Capital Gains Tax due on any UK property disposals made after 6 April 2020 must be reported and paid within 30 days.

This new rule, introduced during the pandemic, is easy to overlook during the sale of a property but it is essential that property sellers now report this information to HM Revenue & Customs (HMRC).

To help taxpayers, HMRC initially announced that no late filing penalties would be issued to those taxpayers who completed a transaction on or after 6 April 2020 to 1 July 2020 and reported it up to 31 July 2020.

With this period of leniency now coming to an end, property sellers must take action. Even those who have previously completed transactions in recent months should be aware that interest is being charged if the tax remains unpaid after 30 days for all transactions from 6 April 2020.

To report the sale of a property to HMRC you may need to create a Capital Gains Tax on UK property account, which can be done by clicking here.

This will allow UK residents and trusts to:

  • report the disposal of UK residential property or land made from 6 April 2020;
  • pay any tax owed for that disposal; and
  • view previous and current returns.

If you are a non-resident you must use this service to report sales or disposals from 6 April 2020 of:

  • residential UK property or land
  • non-residential UK property or land
  • mixed-use UK property or land
  • rights to assets that derive at least 75 per cent of their value from UK land (indirect disposals).

Non-residents must also report all sales or disposals of UK property, even if there is no tax to pay or they have made a loss.

With the Chancellor announcing a Stamp Duty Land Tax Holiday for properties worth £500,000 or less in his recent Summer Economic Update, there is expected to be a surge in property sales, which could result in Capital Gains Tax liabilities.

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