CAPITAL GAINS TAX RETURNS

All gains realised on UK residential property disposals must be reported to HMRC via a CGT Disposal Return.  The Return, Capital Gains Computation and the arising Capital gains tax must be submitted and paid, within:

• 60 days if the completion date was on or after 27 October 2021.
• 30 days if the completion date was between 6 April 2020 and 26 October 2021.

A property disposal return must be completed even if the gain has already been reported under Self Assessment (SA), except on any occasion in which the gain is declared under SA before the end of the 60-day deadline. In this case and this case only, no online property disposal return is required. 

Non UK Resident individuals will need to complete an NRCGT Disposal Return to report the gains.

A property disposal return will only need to be completed if the disposal realises a gain, which is not covered under Private Residence Relief and exceeds your Annual Allowance (Currently £12,300 for the 2022/23 tax year).

Please note that the Capital Gains Tax due cannot be paid until the CGT or NRCGT Return has been processed by HMRC.  If the Return is submitted towards the end of the 60 days and has not been processed by HMRC prior to the 60 day deadline, meaning the CGT cannot be paid, no extension is given in respect of the CGT payment date and as such penalties will arise on the outstanding CGT payment.

All other Capital Gains can still be reported as usual under Self Assessment.

If you are outside the Self Assessment regime, you do not have to register for Self Assessment just to report the capital gain.

Repayment of CGT

As CGT is payable within 60 days of a disposal, it may not always be possible at that time for a taxpayer to know what their total Income Tax liability will be for the year.  Any Capital Gains tax paid will be offset against the taxpayers SA liability for the year, with any overpaid balance being repayable by HMRC.

Alternatively, if the taxpayer does become aware of the total Income tax liability for the year, and there is sufficient time remaining before they are submitting their SA Return, the taxpayer should amend the CGT UK property return and this will allow a refund via the CGT system. If this is done before submitting the SA return this will avoid the need for HMRC to create a manual override.