28 June 2019
The government have decided they want to receive the tax on residential property sales much sooner, and so the rules have been changed.
From April 2020, UK residents who dispose of UK residential property will need to pay Capital Gains Tax (CGT) and submit CGT returns, within 30 days of completion of the sale.
For example, if the sale completes on 1 July 2020, the CGT will be due by 30 July 2020.
Currently taxpayers have either 10 or 22 months to pay CGT, so this is a big change and there will be penalties and interest charged for failure to comply with these rules.
Due to HM Revenue & Customs (HMRC) plans to ensure the change in rules are communicated to the public, it will be much harder for those who miss the deadline, to successfully appeal against any penalties. It is therefore crucial you seek tax support to ensure you comply with the new rules. Ellacotts can take the stress away and undertake the CGT tax return work for you.
The new rules apply to individuals, trustees and personal representatives. There are some exemptions in place with regards to certain sales, for example the sale of your main residence.
Landlords have faced so many changes over recent years; the restriction to the mortgage interest relief, additional Stamp Duty Land Tax and the new regime for non-UK residents means that the new payment regime is yet another cash-flow blow!
If you own property and you haven’t yet had tax advice to understand how the maze of change will impact you and understand the planning options that are available, then Ellacotts would be happy to help. Our tax team specialise in property taxation for landlords and are well placed to advise. Contact Jennie Brown on 01295 250401 or email firstname.lastname@example.org.